Meet Kevin Pricing Power ETF Review

Kevin Paffrath’s journey from below-average high-schooler to multi-millionaire is a classic American success story. Paffrath, who looks young enough to be a recent graduate, started with nothing. By the time he was 30, he had built a portfolio worth more than $6 million. 

Paffrath was still in high school when he started thinking about real estate – in between avoiding his schoolwork and playing video games. He examined the market in his community and saw tremendous untapped potential.

Instead of waiting until he had the education and experience to launch a traditional career, he decided to dive right in. His innovative marketing methods inspired his peers, attracted clients, and revitalized the real estate industry in his area.  

Paffrath became synonymous with passion and enthusiasm, and he discovered a special talent for identifying properties that would deliver profit for investors. He didn’t keep his methods to himself. Instead, he created a social media platform and shared his techniques with the world through his YouTube channel, Meet Kevin. 

Of course, as an entrepreneur and innovator, Paffrath didn’t stop with real estate and social media. What’s next for Meet Kevin’s Kevin Paffrath? 

Does Meet Kevin Have An ETF?

Kevin Paffrath lives the tagline “go big or go home” – and he can be relied upon to go big in everything he does. His monthly income is estimated at $150,000+, but that’s just the beginning.

Paffrath is now exploring opportunities in the world of investing. He is particularly excited about his Pricing Power ETF, which launched on November 28, 2022.

Here’s what you need to know. 

What Does Pricing Power Mean?

The Pricing Power ETF chooses which companies to invest in based on a short list of screening criteria. Innovation is a key characteristic of Meet Kevin’s Pricing Power ETF holdings, but even more important is “price elasticity” or “pricing power.” 

This isn’t a new concept – billionaire Warren Buffett, one of the most successful investors of all time, has referenced price elasticity as a compelling factor in measuring any company’s competitive edge – what he refers to as a “moat.” Essentially, pricing power is a company’s ability to increase prices without losing customers. 

Examples of Warren Buffett stocks that have pricing power include Coca-Cola and Netflix. Both are so beloved by their users that they have successfully introduced price increases without a commensurate decrease in demand.

Meet Kevin Pricing Power ETF Holdings

Meet Kevin’s Pricing Power ETF is an actively managed fund with the goal of generating long-term capital appreciation. It isn’t relying on established blue chips to achieve this objective.

Instead, Paffrath wants his ETF to hold companies focused on innovation – the ones creating the technologies of the future.

Most of the Pricing Power ETF’s holdings are US-listed companies, and many of the fund’s biggest holdings are in the tech sector. 

The Pricing Power ETF’s top ten holdings as of early August 2023 include: 

• Tesla (automotive; alternative energy) – 23.21 percent of net assets
• Enphase Energy (alternative/solar energy) – 12.08 percent of net assets 
• Apple (smart devices) – 11.40 percent of net assets 
• NVIDIA (graphics processing units) – 5.46 percent of net assets 
• Trade Desk (marketing automation technologies) – 5.27 percent of net assets 
• Intel (semiconductors) – 4.92 percent of net assets 
• Advanced Micro Devices (semiconductors) – 4.87 percent of net assets 
• Ubiquiti (wireless data communication)- 4.80 percent of net assets 
• ASML Holding (semiconductors) – 4.78 percent of net assets 
• Taiwan Semiconductor Manufacturing (semiconductors) – 4.70 percent of net assets 

When divided into sectors, the Meet Kevin Pricing Power ETF is allocated as follows: 

• Technology – 41.26 percent of net assets 
• Consumer Goods – 22.55 percent of net assets 
• Industrials – 14.43 percent of net assets 
• Oil and Gas – 14.01 percent of net assets 
• Consumer Services – 7.37 percent of net assets

The fund’s net assets total $43.8 million, and more than 99 percent of holdings are in stocks. 

Meet Kevin Pricing Power ETF Expense Ratio

Exchange-traded funds (ETFs) have several advantages over mutual funds. One of the most popular is the way ETF shares trade. Unlike mutual funds, which trade at the end of each day, ETF shares trade throughout the day like stocks. 

Many investors like ETFs because they have low expense ratios. The very lowest expense ratios are associated with passively-managed funds. Passively-managed ETFs are tied to an underlying index, so their expense ratios can be as low as 0.2 percent. 

Actively-managed funds require more attention from fund managers, and that is reflected in expense ratios. Anything from 0.5 percent to 0.75 percent is generally considered reasonable. Expense ratios exceeding 1.5 percent are typically considered excessive.

The Meet Kevin Pricing Power ETF expense ratio comes in at 0.77 percent, which is on the higher end of average, though not quite to the point of excessive. 

It is worth noting that Kevin Paffrath does not manage the Pricing Power ETF himself. Fund management responsibilities have been assigned to a Sub-Advisor, Plato’s Philosophy LLC. This firm evaluates companies to identify those that best meet the fund objectives as defined in the prospectus. 

Specifically, they determine which companies qualify as “innovative” – that is, “involved in the development of new products or services, technological advancements, consumer engagement, and/or disruptive approaches with respect to business growth that the Sub-Adviser expects to have a significant impact on the market or industry in which the company operates.” 

The Sub-Advisor also determines which of the companies that qualify as innovative also have superior pricing power as compared to their peers. 

Meet Kevin Pricing Power ETF Review

The Meet Kevin Pricing Power ETF is heavily invested in technology, and Tesla stock makes up approximately one-fourth of its total assets.

That lack of diversity is a risky proposition, no matter how skilled the fund manager is. The renowned Cathie Wood of ARK Invest experienced the downside of concentrating a large percentage of assets in a single sector.

In 2022, there was a massive selloff of tech stocks. Her flagship fund, the ARK Innovation ETF (ARKK), ended the year with a loss of 67 percent. The Meet Kevin Pricing Power ETF could suffer similar losses if tech stocks drop again. 

Tech stocks are recovering in 2023, but continued recovery is not guaranteed. While it is likely that high-quality tech stocks like Apple will increase in value long-term, it isn’t possible to predict how tech stocks will perform overall during a specific period of time. That’s fine for Pricing Power ETF shareholders with investment horizons that span decades. Flexibility will be key when choosing whether the time is right to sell. Those who may need to pull their funds to meet short-term financial goals may find the Pricing Power ETF too volatile.

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.