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Semiannual
Report |
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February
28, 2022 |
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American
Century®
Focused Dynamic Growth ETF (FDG) |
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American
Century®
Focused Large Cap Value ETF (FLV) |
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President’s
Letter |
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Focused
Dynamic Growth ETF |
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Fund
Characteristics |
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Focused
Large Cap Value ETF |
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Fund
Characteristics |
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Shareholder
Fee Examples |
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Schedules
of Investments |
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Statements
of Assets and Liabilities |
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Statements
of Operations |
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Statements
of Changes in Net Assets |
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Notes
to Financial Statements |
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Financial
Highlights |
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Additional
Information |
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Any
opinions expressed in this report reflect those of the author as of the date of
the report, and do not necessarily represent the opinions of American Century
Investments®
or any other person in the American Century Investments organization. Any such
opinions are subject to change at any time based upon market or other conditions
and American Century Investments disclaims any responsibility to update such
opinions. These opinions may not be relied upon as investment advice and,
because investment decisions made by American Century Investments funds are
based on numerous factors, may not be relied upon as an indication of trading
intent on behalf of any American Century Investments fund. Security examples are
used for representational purposes only and are not intended as recommendations
to purchase or sell securities. Performance information for comparative indices
and securities is provided to American Century Investments by third party
vendors. To the best of American Century Investments’ knowledge, such
information is accurate at the time of printing.
The
funds utilize the ActiveShares®
methodology
licensed from Precidian Investments, LLC (Precidian). Precidian’s products and
services are protected by domestic and international intellectual property
protections, including, without limitation, the following issued patents and
pending patent applications: 7813987, 8285624, 7925562, 13011746, 14528658,
14208966, 16196560.
Jonathan
Thomas
Dear
Investor:
Thank
you for reviewing this semiannual report for the period ended February 28, 2022.
It provides a market overview (below), followed by a schedule of fund
investments and other financial information. For additional investment insights,
please visit americancenturyetfs.com.
Escalating
Volatility, Soaring Inflation Weighed on Returns
Upbeat
economic data and continued central bank support generally buoyed global stock
returns early in the period, even as inflation and government bond yields were
climbing. However, bond returns broadly struggled as inflation and yields
climbed higher.
In
November, the emergence of the omicron coronavirus variant rattled global
financial markets. The downturn was short-lived, though, as omicron proved to be
less severe than other variants. Stocks resumed their upward march until early
2022, when worries about inflation, central bank policy and Russia’s invasion of
Ukraine sparked sharp volatility.
Throughout
the period, steady economic gains combined with ongoing monetary support,
escalating energy prices and considerable supply chain disruptions ignited
inflation. By February, year-over-year headline inflation in the U.S. reached
7.9%, a 40-year high, while European inflation rose to a record 5.8%. In the
U.S., this backdrop set the stage for Federal Reserve (Fed) tightening,
including the Fed’s first rate hike in more than three years.
Most
asset classes, including broad stock and bond indices, declined for the
six-month period. U.S. stocks generally fared better than non-U.S. stocks, and
the value style significantly outperformed the growth style. U.S. and global
bond returns declined as yields rose.
Staying
Focused in Uncertain Times
Russia’s
invasion of Ukraine has led to a devastating humanitarian crisis and further
complicated a tense geopolitical backdrop. Even before the West imposed
sanctions on Russia, our firm had started reducing exposure to Russian markets.
After the sanctions, our direct exposure to Russian assets was less than $5
million, or 0.001% of total assets under supervision (as of March 7). We will
continue to monitor the evolving situation and its implications for our clients
and our investment exposure.
We
appreciate your confidence in us during these extraordinary times. Our firm has
a long history of helping clients weather unpredictable and volatile markets,
and we’re confident we will continue to meet prevailing challenges.
Sincerely,
Jonathan
Thomas
President
and Chief Executive Officer
American
Century Investments
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FEBRUARY
28, 2022 |
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Focused
Dynamic Growth ETF |
|
Types
of Investments in Portfolio |
%
of net assets |
Common
Stocks |
99.7% |
Short-Term
Investments |
0.3% |
Other
Assets and Liabilities |
—* |
*Category
is less than 0.05% of total net assets. |
|
|
|
Top
Five Industries |
%
of net assets |
IT
Services |
15.5% |
Software |
11.6% |
Interactive
Media and Services |
10.9% |
Automobiles |
8.9% |
Internet
and Direct Marketing Retail |
8.8% |
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|
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|
|
FEBRUARY
28, 2022 |
|
|
|
Focused
Large Cap Value ETF |
|
Types
of Investments in Portfolio |
%
of net assets |
Common
Stocks |
98.7% |
Short-Term
Investments |
1.0% |
Other
Assets and Liabilities |
0.3% |
|
|
Top
Five Industries |
%
of net assets |
Insurance |
11.0% |
Health
Care Equipment and Supplies |
9.5% |
Pharmaceuticals |
9.1% |
Oil,
Gas and Consumable Fuels |
5.6% |
Banks |
5.4% |
Fund
shareholders may incur two types of costs: (1) transaction costs, including
brokerage commissions paid on purchases and sales of fund shares; and (2)
ongoing costs, including management fees and other fund expenses. This example
is intended to help you understand your ongoing costs (in dollars) of investing
in your fund and to compare these costs with the ongoing cost of investing in
other funds.
The
example is based on an investment of $1,000 made at the beginning of the period
and held for the entire period from September 1, 2021 to February 28,
2022.
Actual
Expenses
The
table provides information about actual account values and actual expenses for
each fund. You may use the information, together with the amount you invested,
to estimate the expenses that you paid over the period. First, identify the fund
you own. Then simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
under the heading “Expenses Paid During Period” to estimate the expenses you
paid on your account during this period.
Hypothetical
Example for Comparison Purposes
The
table also provides information about hypothetical account values and
hypothetical expenses based on the actual expense ratio of your fund and an
assumed rate of return of 5% per year before expenses, which is not the actual
return of a fund. The hypothetical account values and expenses may not be used
to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in your fund and other funds. To do so, compare this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of the
other funds.
Please
note that the expenses shown in the table are meant to highlight your ongoing
costs only and do not reflect any transactional costs, such as brokerage
commissions paid on purchases and sales of fund shares. Therefore, the table is
useful in comparing ongoing costs only, and will not help you determine the
relative total costs of owning different funds. In addition, if these
transactional costs were included, your costs would have been
higher.
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Beginning Account
Value 9/1/21 |
Ending
Account Value 2/28/22 |
Expenses
Paid
During
Period(1)
9/1/21
- 2/28/22 |
Annualized
Expense
Ratio(1) |
Focused
Dynamic Growth ETF |
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Actual |
$1,000 |
$795.90 |
$2.00 |
0.45% |
Hypothetical |
$1,000 |
$1,022.56 |
$2.26 |
0.45% |
Focused
Large Cap Value ETF |
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Actual |
$1,000 |
$999.90 |
$2.08 |
0.42% |
Hypothetical |
$1,000 |
$1,022.71 |
$2.11 |
0.42% |
(1)Expenses
are equal to the fund's annualized expense ratio listed in the table above,
multiplied by the average account value over the period, multiplied by 181, the
number of days in the most recent fiscal half-year, divided by 365, to reflect
the one-half year period. Annualized expense ratio reflects actual expenses,
including any applicable fee waivers or expense reimbursements and excluding any
acquired fund fees and expenses.
FEBRUARY
28, 2022 (UNAUDITED)
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Focused
Dynamic Growth ETF |
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Shares |
Value |
COMMON
STOCKS — 99.7% |
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Aerospace
and Defense — 0.8% |
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Rocket
Lab USA, Inc.(1)
|
131,178 |
|
$ |
1,251,438 |
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Automobiles
— 8.9% |
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Tesla,
Inc.(1)
|
16,920 |
|
14,727,676 |
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Beverages
— 5.9% |
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Boston
Beer Co., Inc. (The), Class A(1)
|
5,758 |
|
2,207,963 |
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Constellation
Brands, Inc., Class A |
34,622 |
|
7,465,195 |
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|
9,673,158 |
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Biotechnology
— 7.2% |
|
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Alnylam
Pharmaceuticals, Inc.(1)
|
18,382 |
|
2,901,599 |
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Argenx
SE, ADR(1)
|
6,621 |
|
1,904,928 |
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Ascendis
Pharma A/S, ADR(1)
|
11,116 |
|
1,249,327 |
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Blueprint
Medicines Corp.(1)
|
23,394 |
|
1,416,507 |
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Regeneron
Pharmaceuticals, Inc.(1)
|
7,071 |
|
4,372,423 |
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|
|
11,844,784 |
|
Capital
Markets — 4.6% |
|
|
Intercontinental
Exchange, Inc. |
26,243 |
|
3,362,253 |
|
S&P
Global, Inc. |
11,018 |
|
4,139,463 |
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|
7,501,716 |
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Diversified
Consumer Services — 0.5% |
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Chegg,
Inc.(1)
|
28,512 |
|
891,570 |
|
Electrical
Equipment — 2.0% |
|
|
Rockwell
Automation, Inc. |
12,358 |
|
3,294,396 |
|
Electronic
Equipment, Instruments and Components — 1.8% |
|
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Cognex
Corp. |
44,830 |
|
3,028,715 |
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Energy
Equipment and Services — 1.9% |
|
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Cactus,
Inc., Class A |
60,719 |
|
3,076,024 |
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Entertainment
— 3.3% |
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Netflix,
Inc.(1)
|
10,375 |
|
4,093,145 |
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ROBLOX
Corp., Class A(1)
|
26,104 |
|
1,346,183 |
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|
5,439,328 |
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Health
Care Equipment and Supplies — 4.0% |
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Intuitive
Surgical, Inc.(1)
|
20,509 |
|
5,954,378 |
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Silk
Road Medical, Inc.(1)
|
19,374 |
|
719,357 |
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|
6,673,735 |
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Hotels,
Restaurants and Leisure — 1.8% |
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Chipotle
Mexican Grill, Inc.(1)
|
1,900 |
|
2,894,365 |
|
Interactive
Media and Services — 10.9% |
|
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Alphabet,
Inc., Class C(1)
|
4,640 |
|
12,517,885 |
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Meta
Platforms, Inc., Class A(1)
|
21,560 |
|
4,549,807 |
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Nextdoor
Holdings, Inc.(1)
|
152,298 |
|
954,908 |
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|
18,022,600 |
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Internet
and Direct Marketing Retail — 8.8% |
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Amazon.com,
Inc.(1)
|
4,723 |
|
14,505,561 |
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IT
Services — 15.5% |
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Block,
Inc.(1)
|
33,568 |
|
4,279,920 |
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Focused
Dynamic Growth ETF |
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Shares |
Value |
Mastercard,
Inc., Class A |
17,778 |
|
$ |
6,414,658 |
|
Okta,
Inc.(1)
|
41,662 |
|
7,617,480 |
|
Visa,
Inc., Class A |
33,121 |
|
7,158,111 |
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|
25,470,169 |
|
Machinery
— 3.5% |
|
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Westinghouse
Air Brake Technologies Corp. |
62,515 |
|
5,802,642 |
|
Professional
Services — 0.4% |
|
|
Verisk
Analytics, Inc. |
3,828 |
|
678,857 |
|
Semiconductors
and Semiconductor Equipment — 4.6% |
|
|
Monolithic
Power Systems, Inc. |
13,716 |
|
6,291,529 |
|
NVIDIA
Corp. |
5,084 |
|
1,239,734 |
|
|
|
7,531,263 |
|
Software
— 11.6% |
|
|
Bill.com
Holdings, Inc.(1)
|
30,734 |
|
7,311,004 |
|
DocuSign,
Inc.(1)
|
34,949 |
|
4,139,010 |
|
Paylocity
Holding Corp.(1)
|
20,775 |
|
4,413,441 |
|
salesforce.com,
Inc.(1)
|
15,858 |
|
3,338,585 |
|
|
|
19,202,040 |
|
Textiles,
Apparel and Luxury Goods — 1.7% |
|
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NIKE,
Inc., Class B |
20,835 |
|
2,845,019 |
|
TOTAL
COMMON STOCKS
(Cost
$151,051,404) |
|
164,355,056 |
|
SHORT-TERM
INVESTMENTS — 0.3% |
|
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Money
Market Funds — 0.3% |
|
|
State
Street Institutional U.S. Government Money Market Fund, Premier Class
|
469,757 |
|
469,757 |
|
TOTAL
SHORT-TERM INVESTMENTS
(Cost
$469,757) |
|
469,757 |
|
TOTAL
INVESTMENT SECURITIES — 100.0%
(Cost
$151,521,161) |
|
164,824,813 |
|
OTHER
ASSETS AND LIABILITIES†
|
|
(9,110) |
|
TOTAL
NET ASSETS — 100.0% |
|
$ |
164,815,703 |
|
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NOTES
TO SCHEDULE OF INVESTMENTS |
ADR |
- |
American
Depositary Receipt |
†Category
is less than 0.05% of total net assets.
(1)Non-income
producing.
See
Notes to Financial Statements.
FEBRUARY
28, 2022 (UNAUDITED)
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Focused
Large Cap Value ETF |
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|
Shares |
Value |
COMMON
STOCKS — 98.7% |
|
|
Aerospace
and Defense — 2.1% |
|
|
Raytheon
Technologies Corp. |
47,087 |
|
$ |
4,835,835 |
|
Airlines
— 1.0% |
|
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Southwest
Airlines Co.(1)
|
53,308 |
|
2,334,891 |
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Banks
— 5.4% |
|
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JPMorgan
Chase & Co. |
53,630 |
|
7,604,734 |
|
Truist
Financial Corp. |
74,680 |
|
4,646,590 |
|
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|
12,251,324 |
|
Beverages
— 1.5% |
|
|
PepsiCo,
Inc. |
21,029 |
|
3,443,288 |
|
Capital
Markets — 3.2% |
|
|
Bank
of New York Mellon Corp. (The) |
135,373 |
|
7,195,075 |
|
Commercial
Services and Supplies — 1.8% |
|
|
Republic
Services, Inc. |
35,050 |
|
4,215,814 |
|
Communications
Equipment — 4.5% |
|
|
Cisco
Systems, Inc. |
143,797 |
|
8,019,558 |
|
F5,
Inc.(1)
|
11,068 |
|
2,223,008 |
|
|
|
10,242,566 |
|
Containers
and Packaging — 1.1% |
|
|
Sonoco
Products Co. |
43,137 |
|
2,533,005 |
|
Diversified
Financial Services — 4.8% |
|
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Berkshire
Hathaway, Inc., Class B(1)
|
34,312 |
|
11,029,592 |
|
Diversified
Telecommunication Services — 3.5% |
|
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Verizon
Communications, Inc. |
148,704 |
|
7,980,944 |
|
Electric
Utilities — 3.0% |
|
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Duke
Energy Corp. |
32,547 |
|
3,268,044 |
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Pinnacle
West Capital Corp. |
48,823 |
|
3,458,133 |
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|
|
6,726,177 |
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Electrical
Equipment — 5.2% |
|
|
ABB
Ltd., ADR |
115,753 |
|
3,898,561 |
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Emerson
Electric Co. |
63,762 |
|
5,924,765 |
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Hubbell,
Inc. |
11,324 |
|
2,018,503 |
|
|
|
11,841,829 |
|
Equity
Real Estate Investment Trusts (REITs) — 1.0% |
|
|
American
Tower Corp. |
10,327 |
|
2,342,886 |
|
Food
and Staples Retailing — 2.5% |
|
|
Sysco
Corp. |
32,380 |
|
2,820,298 |
|
Walmart,
Inc. |
21,257 |
|
2,873,096 |
|
|
|
5,693,394 |
|
Food
Products — 3.9% |
|
|
Conagra
Brands, Inc. |
121,128 |
|
4,235,846 |
|
Mondelez
International, Inc., Class A |
70,833 |
|
4,638,145 |
|
|
|
8,873,991 |
|
Gas
Utilities — 3.0% |
|
|
Atmos
Energy Corp. |
62,739 |
|
6,889,370 |
|
Health
Care Equipment and Supplies — 9.5% |
|
|
Becton
Dickinson and Co. |
19,555 |
|
5,304,881 |
|
Medtronic
plc |
96,069 |
|
10,086,284 |
|
Zimmer
Biomet Holdings, Inc. |
48,791 |
|
6,205,727 |
|
|
|
21,596,892 |
|
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|
|
|
|
|
|
|
|
Focused
Large Cap Value ETF |
|
|
|
Shares |
Value |
Health
Care Providers and Services — 3.6% |
|
|
Henry
Schein, Inc.(1)
|
28,171 |
|
$ |
2,433,411 |
|
Humana,
Inc. |
4,227 |
|
1,835,871 |
|
UnitedHealth
Group, Inc. |
8,045 |
|
3,828,374 |
|
|
|
8,097,656 |
|
Health
Care Technology — 3.0% |
|
|
Cerner
Corp. |
74,179 |
|
6,917,192 |
|
Household
Products — 2.0% |
|
|
Colgate-Palmolive
Co. |
29,735 |
|
2,288,108 |
|
Kimberly-Clark
Corp. |
17,283 |
|
2,249,383 |
|
|
|
4,537,491 |
|
Industrial
Conglomerates — 0.5% |
|
|
Honeywell
International, Inc. |
5,674 |
|
1,076,642 |
|
Insurance
— 11.0% |
|
|
Aflac,
Inc. |
63,257 |
|
3,864,370 |
|
Allstate
Corp. (The) |
43,366 |
|
5,306,264 |
|
Chubb
Ltd. |
26,286 |
|
5,352,881 |
|
Marsh
& McLennan Cos., Inc. |
38,479 |
|
5,980,021 |
|
Reinsurance
Group of America, Inc. |
40,908 |
|
4,535,061 |
|
|
|
25,038,597 |
|
Oil,
Gas and Consumable Fuels — 5.6% |
|
|
Chevron
Corp. |
45,415 |
|
6,539,760 |
|
TotalEnergies
SE, ADR |
125,270 |
|
6,329,893 |
|
|
|
12,869,653 |
|
Personal
Products — 3.6% |
|
|
Unilever
plc, ADR |
163,924 |
|
8,240,459 |
|
Pharmaceuticals
— 9.1% |
|
|
Johnson
& Johnson |
73,831 |
|
12,150,368 |
|
Merck
& Co., Inc. |
55,354 |
|
4,239,009 |
|
Novartis
AG, ADR |
48,907 |
|
4,277,406 |
|
|
|
20,666,783 |
|
Semiconductors
and Semiconductor Equipment — 1.4% |
|
|
Texas
Instruments, Inc. |
18,425 |
|
3,132,066 |
|
Software
— 1.9% |
|
|
Open
Text Corp. |
60,451 |
|
2,629,619 |
|
Oracle
Corp. (New York) |
22,460 |
|
1,706,286 |
|
|
|
4,335,905 |
|
TOTAL
COMMON STOCKS
(Cost
$198,044,801) |
|
224,939,317 |
|
SHORT-TERM
INVESTMENTS — 1.0% |
|
|
Money
Market Funds — 1.0% |
|
|
State
Street Institutional U.S. Government Money Market Fund, Premier Class
|
2,258,067 |
|
2,258,067 |
|
TOTAL
SHORT-TERM INVESTMENTS
(Cost
$2,258,067) |
|
2,258,067 |
|
TOTAL
INVESTMENT SECURITIES — 99.7%
(Cost
$200,302,868) |
|
227,197,384 |
|
OTHER
ASSETS AND LIABILITIES — 0.3% |
|
606,704 |
|
TOTAL
NET ASSETS — 100.0% |
|
$ |
227,804,088 |
|
|
|
|
|
|
|
|
|
|
NOTES
TO SCHEDULE OF INVESTMENTS |
ADR |
- |
American
Depositary Receipt |
(1)Non-income
producing.
See
Notes to Financial Statements.
|
|
|
Statements
of Assets and Liabilities |
|
|
|
|
|
|
|
|
|
FEBRUARY
28, 2022 (UNAUDITED) |
|
|
Focused
Dynamic Growth ETF |
Focused
Large Cap Value ETF |
Assets |
|
Investment
securities, at value (cost of $151,521,161 and $200,302,868,
respectively) |
$ |
164,824,813 |
|
$ |
227,197,384 |
|
Dividends
and interest receivable |
49,439 |
|
680,494 |
|
|
164,874,252 |
|
227,877,878 |
|
|
|
|
Liabilities |
|
|
Accrued
management fees |
58,549 |
|
73,790 |
|
|
|
|
Net
Assets |
$ |
164,815,703 |
|
$ |
227,804,088 |
|
|
|
|
Shares
outstanding (unlimited number of shares authorized) |
2,385,000 |
|
3,785,000 |
|
|
|
|
Net
Asset Value Per Share |
$ |
69.11 |
|
$ |
60.19 |
|
|
|
|
Net
Assets Consist of: |
|
|
Capital
paid in |
$ |
144,105,664 |
|
$ |
187,676,312 |
|
Distributable
earnings |
20,710,039 |
|
40,127,776 |
|
|
$ |
164,815,703 |
|
$ |
227,804,088 |
|
See
Notes to Financial Statements.
|
|
|
|
|
|
|
|
|
FOR
THE SIX MONTHS ENDED FEBRUARY 28, 2022 (UNAUDITED) |
|
|
Focused
Dynamic Growth ETF |
Focused
Large Cap Value ETF |
Investment
Income (Loss) |
|
Income: |
|
|
Dividends
(net of foreign taxes withheld of $— and $46,214, respectively) |
$ |
219,825 |
|
$ |
2,711,509 |
|
Interest |
117 |
|
285 |
|
|
219,942 |
|
2,711,794 |
|
|
|
|
Expenses: |
|
|
Management
fees |
458,256 |
|
497,598 |
|
|
|
|
Net
investment income (loss) |
(238,314) |
|
2,214,196 |
|
|
|
|
Realized
and Unrealized Gain (Loss) |
|
|
Net
realized gain (loss) on investment transactions (Note 4) |
8,123,956 |
|
12,468,450 |
|
Change
in net unrealized appreciation (depreciation) on investments |
(53,733,214) |
|
(15,098,199) |
|
|
|
|
Net
realized and unrealized gain (loss) |
(45,609,258) |
|
(2,629,749) |
|
|
|
|
Net
Increase (Decrease) in Net Assets Resulting from Operations |
$ |
(45,847,572) |
|
$ |
(415,553) |
|
See
Notes to Financial Statements.
|
|
|
Statements
of Changes in Net Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SIX
MONTHS ENDED FEBRUARY 28, 2022 (UNAUDITED) AND YEAR ENDED AUGUST 31,
2021 |
|
Focused
Dynamic Growth ETF |
Focused
Large Cap Value ETF |
Increase
(Decrease) in Net Assets |
February
28, 2022 |
August
31, 2021 |
February
28, 2022 |
August
31, 2021 |
Operations |
|
|
Net
investment income (loss) |
$ |
(238,314) |
|
$ |
(370,443) |
|
$ |
2,214,196 |
|
$ |
3,728,184 |
|
Net
realized gain (loss) |
8,123,956 |
|
27,904,615 |
|
12,468,450 |
|
5,086,205 |
|
Change
in net unrealized appreciation (depreciation) |
(53,733,214) |
|
23,407,498 |
|
(15,098,199) |
|
37,043,077 |
|
Net
increase (decrease) in net assets resulting from operations |
(45,847,572) |
|
50,941,670 |
|
(415,553) |
|
45,857,466 |
|
|
|
|
|
|
Distributions
to Shareholders |
|
|
|
|
From
earnings |
— |
|
(21,840) |
|
(7,456,146) |
|
(2,991,009) |
|
|
|
|
|
|
Capital
Share Transactions |
|
|
|
|
Proceeds
from shares sold |
17,067,918 |
|
59,816,448 |
|
15,004,854 |
|
138,524,192 |
|
Payments
for shares redeemed |
(37,791,294) |
|
(88,569,594) |
|
(43,453,409) |
|
— |
|
Other
capital |
1,646 |
|
4,916 |
|
896 |
9,570 |
|
Net
increase (decrease) in net assets from capital share
transactions |
(20,721,730) |
|
(28,748,230) |
|
(28,447,659) |
|
138,533,762 |
|
|
|
|
|
|
Net
increase (decrease) in net assets |
(66,569,302) |
|
22,171,600 |
|
(36,319,358) |
|
181,400,219 |
|
|
|
|
|
|
Net
Assets |
|
|
|
|
Beginning
of period |
231,385,005 |
|
209,213,405 |
|
264,123,446 |
|
82,723,227 |
|
End
of period |
$ |
164,815,703 |
|
$ |
231,385,005 |
|
$ |
227,804,088 |
|
$ |
264,123,446 |
|
|
|
|
|
|
Transactions
in Shares of the Funds |
|
|
|
|
Sold |
200,000 |
|
780,000 |
|
250,000 |
|
2,560,000 |
|
Redeemed |
(480,000) |
|
(1,190,000) |
|
(715,000) |
|
— |
|
Net
increase (decrease) in shares of the funds |
(280,000) |
|
(410,000) |
|
(465,000) |
|
2,560,000 |
|
See
Notes to Financial Statements.
|
|
|
Notes
to Financial Statements |
FEBRUARY
28, 2022 (UNAUDITED)
1.
Organization
American
Century ETF Trust (the trust) was registered as a Delaware statutory trust in
2017 and is registered under the Investment Company Act of 1940, as amended (the
1940 Act), as an open-end management investment company. American Century
Focused Dynamic Growth ETF (Focused Dynamic Growth ETF) and American Century
Focused Large Cap Value ETF (Focused Large Cap Value ETF) (collectively, the
funds) are two funds in a series issued by the trust. Each fund's investment
objective is to seek long-term capital growth. Shares of each fund are listed
for trading on the Cboe BZX Exchange, Inc.
2.
Significant Accounting Policies
The
following is a summary of significant accounting policies consistently followed
by the funds in preparation of their financial statements. Each fund is an
investment company and follows accounting and reporting guidance in accordance
with accounting principles generally accepted in the United States of America.
This may require management to make certain estimates and assumptions at the
date of the financial statements. Actual results could differ from these
estimates. Management evaluated the impact of events or transactions occurring
through the date the financial statements were issued that would merit
recognition or disclosure.
Investment
Valuations — The
funds determine the fair value of their investments and compute their net asset
value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern
time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The
Board of Trustees has adopted valuation policies and procedures to guide the
investment advisor in the funds' investment valuation process and to provide
methodologies for the oversight of the funds' pricing function.
Equity
securities that are listed or traded on a domestic securities exchange are
valued at the last reported sales price or at the official closing price as
provided by the exchange. Equity securities traded on foreign securities
exchanges are generally valued at the closing price of such securities on the
exchange where primarily traded or at the close of the NYSE, if that is earlier.
If no last sales price is reported, or if local convention or regulation so
provides, the mean of the latest bid and asked prices may be used. Securities
traded over-the-counter are valued at the mean of the latest bid and asked
prices, the last sales price, or the official closing price.
Open-end
management investment companies are valued at the reported NAV per
share.
If
the funds determine that the market price for an investment is not readily
available or the valuation methods mentioned above do not reflect an
investment’s fair value, such investment is valued as determined in good faith
by the Board of Trustees or its delegate, in accordance with policies and
procedures adopted by the Board of Trustees. In its determination of fair value,
the funds may review several factors including, but not limited to, market
information regarding the specific investment or comparable investments and
correlation with other investment types, futures indices or general market
indicators. Circumstances that may cause the funds to use these procedures to
value an investment include, but are not limited to: an investment has been
declared in default or is distressed; trading in a security has been suspended
during the trading day or a security is not actively trading on its principal
exchange; prices received from a regular pricing source are deemed unreliable;
or there is a foreign market holiday and no trading occurred.
The
funds monitor for significant events occurring after the close of an
investment’s primary exchange but before each fund’s NAV per share is
determined. Significant events may include, but are not limited to: corporate
announcements and transactions; governmental action and political unrest that
could impact a specific investment or an investment sector; or armed conflicts,
natural disasters and similar events that could affect investments in a specific
country or region. The funds also monitor for significant fluctuations between
domestic and foreign markets, as evidenced by the U.S. market or such other
indicators that the Board of Trustees, or its delegate, deems appropriate. The
funds may apply a model-derived factor to the closing price of equity securities
traded on foreign securities exchanges. The factor is based on observable market
data as provided by an independent pricing service.
Security
Transactions — Security
transactions are accounted for as of the trade date. Net realized gains and
losses are determined on the identified cost basis, which is also used for
federal income tax purposes.
Investment
Income — Dividend
income less foreign taxes withheld, if any, is recorded as of the ex-dividend
date. Distributions received on securities that represent a return of capital or
long-term capital gain are recorded as a reduction of cost of investments and/or
as a realized gain. The funds may estimate the components of distributions
received that may be considered nontaxable distributions or long-term capital
gain distributions for income tax purposes. Interest income is recorded on the
accrual basis and includes accretion of discounts and amortization of
premiums.
Income
Tax Status — It
is each fund’s policy to distribute substantially all net investment income and
net realized gains to shareholders and to otherwise qualify as a regulated
investment company under provisions of the Internal Revenue Code. Accordingly,
no provision has been made for income taxes. The funds file U.S. federal, state,
local and non-U.S. tax returns as applicable. The funds' tax returns are
subject to examination by the relevant taxing authority until expiration of the
applicable statute of limitations, which is generally three years from the date
of filing but can be longer in certain jurisdictions. At this time, management
believes there are no uncertain tax positions which, based on their technical
merit, would not be sustained upon examination and for which it is reasonably
possible that the total amounts of unrecognized tax benefits will significantly
change in the next twelve months.
Distributions
to Shareholders — Distributions
from net investment income, if any, are generally declared and paid quarterly.
Distributions from net realized gains, if any, are generally declared and paid
annually. Each fund may elect to treat a portion of its payment to a redeeming
shareholder, which represents the pro rata share of undistributed net investment
income and net realized gains, as a distribution for federal income tax purposes
(tax equalization).
Indemnifications
— Under
the trust’s organizational documents, its officers and trustees are indemnified
against certain liabilities arising out of the performance of their duties to
the funds. In addition, in the normal course of business, the funds enter into
contracts that provide general indemnifications. The maximum exposure under
these arrangements is unknown as this would involve future claims that may be
made against a fund. The risk of material loss from such claims is considered by
management to be remote.
3.
Fees and Transactions with Related Parties
Certain
officers and trustees of the trust are also officers and/or directors of
American Century Companies, Inc. (ACC). The trust's investment advisor, American
Century Investment Management, Inc. (ACIM), and the trust’s administrator,
American Century Services, LLC, are wholly owned, directly or indirectly, by
ACC. Various funds issued by American Century Strategic Asset Allocations, Inc.
own, in aggregate, 41% and 35% of the shares of Focused Dynamic Growth ETF and
Focused Large Cap Value ETF, respectively. Related parties do not invest in the
funds for the purpose of exercising management or control.
Management
Fees —
The
trust has entered into a management agreement with ACIM, under which ACIM
provides the funds with investment advisory and management services in exchange
for a single, unified management fee (the fee). The agreement provides that ACIM
will pay all expenses of managing and operating the funds, except brokerage and
other transaction fees and expenses relating to the acquisition and disposition
of portfolio securities, acquired fund fees and expenses, interest, taxes,
litigation expenses and extraordinary expenses. The fee is computed and accrued
daily based on the daily net assets of each fund and paid monthly in
arrears.
The
annual management fee for each fund is as follows:
|
|
|
|
|
|
|
Annual
Management Fee |
Focused
Dynamic Growth ETF |
0.45% |
Focused
Large Cap Value ETF |
0.42% |
4.
Investment Transactions
Purchases
and sales of investment securities, excluding short-term investments and in kind
transactions, for the period ended February 28, 2022 were as
follows:
|
|
|
|
|
|
|
|
|
|
Focused
Dynamic Growth ETF |
Focused
Large Cap Value ETF |
Purchases |
$53,314,870 |
$26,997,650 |
Sales |
$41,728,698 |
$20,185,054 |
Securities
received or delivered in kind through subscriptions and redemptions and in kind
net realized gain (loss) for the period ended February 28, 2022 were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
In
kind Subscriptions |
In
kind Redemptions |
In
kind Net Realized Gain/(Loss)* |
Focused
Dynamic Growth ETF |
$5,916,703 |
$36,749,748 |
$11,615,677 |
Focused
Large Cap Value ETF |
$1,486,887 |
$42,542,926 |
$9,901,907 |
*Net
realized gain (loss) on in kind transactions are not considered taxable for
federal income tax purposes.
5.
Capital Share Transactions
Each
fund’s shares may only be bought and sold in a secondary market through a
broker-dealer at a market price. Because ETF shares trade at market prices
rather than NAV, shares may trade at a price greater than NAV (a premium) or
less than NAV (a discount). Each fund issues and redeems shares at their NAV
only in aggregations of a specified number of shares (a creation unit) generally
in exchange for a designated portfolio of securities and/or cash (including any
portion of such securities for which cash may be substituted). Authorized
participants may be required to pay an additional variable charge to cover
certain brokerage, tax, foreign exchange, execution, market impact and other
costs and expenses related to the execution of trades resulting from creation
unit transactions. Such variable charges, if any, are included in other capital
within the Statements of Changes in Net Assets.
6.
Fair Value Measurements
The
funds’ investment valuation process is based on several considerations and may
use multiple inputs to determine the fair value of the investments held by the
funds. In conformity with accounting principles generally accepted in the United
States of America, the inputs used to determine a valuation are classified into
three broad levels.
•Level
1 valuation inputs consist of unadjusted quoted prices in an active market for
identical investments.
•Level
2 valuation inputs consist of direct or indirect observable market data
(including quoted prices for comparable investments, evaluations of subsequent
market events, interest rates, prepayment speeds, credit risk, etc.). These
inputs also consist of quoted prices for identical investments initially
expressed in local currencies that are adjusted through translation into U.S.
dollars.
•Level
3 valuation inputs consist of unobservable data (including a fund’s own
assumptions).
The
level classification is based on the lowest level input that is significant to
the fair valuation measurement. The valuation inputs are not necessarily an
indication of the risks associated with investing in these securities or other
financial instruments.
As
of period end, the funds’ investment securities were classified as Level 1. The
Schedules of Investments provide additional information on the funds’ portfolio
holdings.
7.
Risk Factors
The
value of the funds’ shares will go up and down, sometimes rapidly or
unpredictably, based on the performance of the securities owned by the funds and
other factors generally affecting the securities market. Market risks, including
political, regulatory, economic and social developments, can affect the value of
the funds’ investments. Natural disasters, public health emergencies, war,
terrorism and other unforeseeable events may lead to increased market volatility
and may have adverse long-term effects on world economies and markets
generally.
There
are certain risks involved in investing in foreign securities. These risks
include those resulting from political events (such as civil unrest, national
elections and imposition of exchange controls), social and economic events (such
as labor strikes and rising inflation), and natural disasters. Securities of
foreign issuers may be less liquid and more volatile. Investing a significant
portion of assets in one country or region may accentuate these risks.
8.
Federal Tax Information
The
book-basis character of distributions made during the year from net investment
income or net realized gains may differ from their ultimate characterization for
federal income tax purposes. These differences reflect the differing character
of certain income items and net realized gains and losses for financial
statement and tax purposes, and may result in reclassification among certain
capital accounts on the financial statements.
As
of period end, the components of investments for federal income tax purposes
were as follows:
|
|
|
|
|
|
|
|
|
|
Focused
Dynamic Growth ETF |
Focused
Large Cap Value ETF |
Federal
tax cost of investments |
$ |
151,939,598 |
|
$ |
200,385,918 |
|
Gross
tax appreciation of investments |
$ |
26,440,564 |
|
$ |
30,506,923 |
|
Gross
tax depreciation of investments |
(13,555,349) |
|
(3,695,457) |
|
Net
tax appreciation (depreciation) of investments |
$ |
12,885,215 |
|
$ |
26,811,466 |
|
The
difference between book-basis and tax-basis unrealized appreciation
(depreciation) is attributable primarily to the tax deferral of losses on wash
sales.
As
of August 31, 2021, Focused Dynamic Growth ETF had late-year ordinary loss
deferrals of $(342,022), which represent certain qualified losses that the fund
has elected to treat as having been incurred in the following fiscal year for
federal income tax purposes.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
a Share Outstanding Throughout the Years Ended August 31 (except as
noted) |
Per-Share
Data |
|
Ratios
and Supplemental Data |
|
|
|
|
Income
From Investment Operations: |
|
|
|
|
Ratio
to Average Net Assets of: |
|
|
|
Net
Asset Value, Beginning of Period |
Net
Investments
Income
(Loss)(1) |
Net Realized and Unrealized Gain
(Loss) |
Total
From Investment Operations |
Distributions From
Net Investment Income |
Other
Capital(1) |
Net
Asset Value, End of Period |
Total
Return(2) |
Operating Expenses |
Net Investment Income (Loss) |
Portfolio
Turnover
Rate(3) |
Net
Assets, End of Period (in thousands) |
Focused
Dynamic Growth ETF |
2022(4) |
$86.82 |
(0.09) |
(17.62) |
(17.71) |
— |
0.00(5) |
$69.11 |
(20.41)% |
0.45%(6) |
(0.23)%(6) |
21% |
$164,816 |
|
2021 |
$68.04 |
(0.13) |
18.92 |
18.79 |
(0.01) |
0.00(5) |
$86.82 |
27.61% |
0.45% |
(0.17)% |
28% |
$231,385 |
|
2020(7) |
$40.00 |
(0.04) |
28.07 |
28.03 |
— |
0.01 |
$68.04 |
70.11% |
0.45%(6) |
(0.16)%(6) |
27% |
$209,213 |
|
|
|
|
Notes
to Financial Highlights |
(1)Computed
using average shares outstanding throughout the period.
(2)Total
returns are calculated based on the net asset value of the last business day.
Total returns for periods less than one year are not annualized.
(3)Excludes
securities received or delivered in kind.
(4)Six
months ended February 28, 2022 (unaudited).
(5)Per-share
amount was less than $0.005.
(6)Annualized.
(7)March
31, 2020 (fund inception) through August 31, 2020.
See
Notes to Financial Statements.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
a Share Outstanding Throughout the Years Ended August 31 (except as
noted) |
Per-Share
Data |
|
|
|
|
|
|
|
|
|
|
Ratios
and Supplemental Data |
|
|
|
Income
From Investment Operations: |
Distributions
From: |
|
|
|
Ratio
to Average Net Assets of: |
|
|
|
Net
Asset Value, Beginning of Period |
Net
Investments
Income
(Loss)(1) |
Net Realized and Unrealized Gain
(Loss) |
Total
From Investment Operations |
Net Investment Income |
Net Realized Gains |
Total Distributions |
Other
Capital(1) |
Net
Asset Value, End of Period |
Total
Return(2) |
Operating Expenses |
Net Investment Income (Loss) |
Portfolio
Turnover
Rate(3) |
Net
Assets, End of Period (in thousands) |
Focused
Large Cap Value ETF |
2022(4) |
$62.15 |
0.56 |
(0.57) |
(0.01) |
(0.61) |
(1.34) |
(1.95) |
0.00(5) |
$60.19 |
(0.01)% |
0.42%(6) |
1.87%(6) |
9% |
$227,804 |
|
2021 |
$48.95 |
1.14 |
13.01 |
14.15 |
(0.95) |
— |
(0.95) |
0.00(5) |
$62.15 |
29.19% |
0.42% |
2.00% |
36% |
$264,123 |
|
2020(7) |
$40.00 |
0.41 |
8.59 |
9.00 |
(0.06) |
— |
(0.06) |
0.01 |
$48.95 |
22.53% |
0.42%(6) |
2.10%(6) |
73% |
$82,723 |
|
|
|
|
Notes
to Financial Highlights |
(1)Computed
using average shares outstanding throughout the period.
(2)Total
returns are calculated based on the net asset value of the last business day.
Total returns for periods less than one year are not annualized.
(3)Excludes
securities received or delivered in kind.
(4)Six
months ended February 28, 2022 (unaudited).
(5)Per-share
amount was less than $0.005.
(6)Annualized.
(7)March
31, 2020 (fund inception) through August 31, 2020.
See
Notes to Financial Statements.
Retirement
Account Information
As
required by law, distributions you receive from certain retirement accounts are
subject to federal income tax withholding, unless you elect not to have
withholding apply*. Tax will be withheld on the total amount withdrawn even
though you may be receiving amounts that are not subject to withholding, such as
nondeductible contributions. In such case, excess amounts of withholding could
occur. You may adjust your withholding election so that a greater or lesser
amount will be withheld.
Remember,
even if you elect not to have income tax withheld, you are liable for paying
income tax on the taxable portion of your withdrawal. If you elect not to have
income tax withheld or you don’t have enough income tax withheld, you may be
responsible for payment of estimated tax. You may incur penalties under the
estimated tax rules if your withholding and estimated tax payments are not
sufficient. You can reduce or defer the income tax on a distribution by directly
or indirectly rolling such distribution over to another IRA or eligible plan.
You should consult your tax advisor for additional information.
State
tax will be withheld if, at the time of your distribution, your address is
within one of the mandatory withholding states and you have federal income tax
withheld (or as otherwise required by state law). State taxes will be withheld
from your distribution in accordance with the respective state rules.
*Some
403(b), 457 and qualified retirement plan distributions may be subject to 20%
mandatory withholding, as they are subject to special tax and withholding
rules. Your plan administrator or plan sponsor is required to provide you
with a special tax notice explaining those rules at the time you request a
distribution. If applicable, federal and/or state taxes may be withheld
from your distribution amount.
Proxy
Voting Policies
A
description of the policies that the funds' investment advisor uses in
exercising the voting rights associated with the securities purchased and/or
held by the funds is available without charge, upon request, by calling
1-800-345-6488. It is also available on American Century Investments’ website at
americancentury.com/proxy and on the Securities and Exchange Commission’s
website at sec.gov. Information regarding how the investment advisor voted
proxies relating to portfolio securities during the most recent 12-month period
ended June 30 is available at americancentury.com/proxy. It is also available at
sec.gov.
Quarterly
Portfolio Disclosure
The
funds file their complete schedule of portfolio holdings with the Securities and
Exchange Commission (SEC) for the first and third quarters of each fiscal year
as an exhibit to their reports on Form N-PORT. The funds' Form N-PORT reports
are available on the SEC’s website at sec.gov.
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Contact
Us |
americancenturyetfs.com |
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American
Century Sales Representatives, Financial Professionals, Broker Dealers,
Insurance Companies, Banks and Trust Companies |
1-833-ACI-ETFS |
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Telecommunications
Relay Service for the Deaf |
711 |
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American
Century ETF Trust |
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Investment
Advisor:
American
Century Investment Management, Inc.
Kansas
City, Missouri |
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Distributor:
Foreside
Fund Services, LLC - Distributor, not affiliated with American Century
Investment Services, Inc. |
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This
report and the statements it contains are submitted for the general
information of our shareholders. The report is not authorized for
distribution to prospective investors unless preceded or accompanied by an
effective prospectus. |
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©2022
American Century Proprietary Holdings, Inc. All rights
reserved. CL-SAN-96953 2204 |
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