EHLS: Double-Digit YTD Outperformance

VS. THE S&P 500

EHLS Up +6.23% YTD (MKT)

Explore our daily released fact sheet for a closer look at recent portfolio highlights.

View Fact Sheet

EHLS compared to indices, YTD as of March 31, 2026

The chart reflects market prices (MKT). The fund's expense ratio is 2.62%, which includes estimated dividends and interest expense on short positions. If this were excluded, the expense ratio would be 1.15%. The fund's inception was 4/2/2024. The performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when sold or redeemed, may be worth more or less than their original cost, and current performance may be lower or higher than the performance quoted. For standardized performance, visit https://www.evenherd.com/ehls.

March has been defined by a meaningful shift in the global backdrop. The coordinated U.S. and Israeli strikes on Iran at the end of February, disruption of shipping through the Strait of Hormuz, and the resulting surge in energy prices have introduced a level of geopolitical uncertainty not seen in years. The S&P 500 has declined from its year-to-date highs and now sits firmly in negative territory for the year while the fund maintains positive gains.

In many ways, the current environment is beginning to resemble the early stages of 2022, when the Russia-Ukraine conflict drove a sharp rise in energy prices, interest rates moved higher, and technology-led equities came under pressure. While no two environments are identical, the parallels in market behavior are notable.

Against this backdrop, the fund’s positioning in Energy, Materials, and Utilities has continued to prove timely. As always, positioning is guided by our proprietary system, not by geopolitical forecasting. The system identified strength in these areas well before recent events and continues to guide allocation regardless of the headlines driving markets.

Diversification across clusters, industries, and individual securities remains central to portfolio construction. The fund ended March at approximately 59% net equity exposure as we continue to balance volatility management with maintaining meaningful upside participation.

IN THIS UPDATE

• Energy and Materials have moved into the top two sector positions in the system, a shift that has been building for several months and has accelerated alongside the geopolitical backdrop.

• Precious metals miners continue to lead the Materials sector, with no stock in the mining cluster trading in the bottom half of stocks we track.

• Energy exposure remains focused on midstream infrastructure, offshore, and shipping, areas benefiting from both current dynamics and longer-term structural demand.

• The fund closed at approximately 59% net equity exposure, with an expected near-term range of 55 to 65%.

LOOKING BACK

ENERGY EMERGES AS A LEADER

Energy has steadily improved within the system over recent months, moving from one of the most underweight sectors last fall to now firmly among the top-ranked positions alongside Materials. This shift began well before recent geopolitical developments, driven by AI-related power demand, improving capital discipline, and strengthening relative momentum.

Geopolitics has simply accelerated the trend. Oil prices surged meaningfully following the conflict, with disruption to key global shipping routes tightening supply expectations. Within the portfolio, exposure remains concentrated in midstream, offshore, and shipping, areas positioned to benefit across a range of outcomes.

PRECIOUS METALS: STRENGTH PERSISTS

The precious metals complex remains a dominant theme within the system. Despite some recent consolidation in gold and silver prices, the mining cluster continues to exhibit broad strength, with no names currently ranking in the bottom half of the universe we track. This continues to support sustained long exposure.

While strong performance across the cluster can limit shorting opportunities, we manage this through diversification and our clustering framework to avoid concentration in any single name.

THE BROADER MARKET

The broader market has experienced continued weakness, particularly across technology, software, and select consumer sectors. This rotation has required disciplined adjustments on the long side.

After tax redeeming most of the position last fall, mid-March, we fully exited a stock we have held since launch, Palantir (PLTR), as its relative strength deteriorated within the system. While we do not anchor to individual names, this serves as a clear example of the discipline required in a rules-based process as leadership shifts.

Meanwhile, Energy, Materials, and Utilities have outperformed as capital continues to rotate toward more tangible, infrastructure-linked businesses. The short portfolio, particularly in software and consumer-related areas, has contributed positively as those segments continue to reprice.

LOOKING FORWARD

VOLATILITY MANAGEMENT REMAINS THE PRIORITY

Managing volatility remains a key focus, particularly in an environment defined by geopolitical uncertainty, shifting interest rate expectations, and continued repricing across sectors. The reduction in net equity exposure reflects this priority as well as signals from our breadth indicators.

Importantly, this effort is not intended to dampen upside participation. Our objective is to shape volatility, not eliminate it, allowing for more consistent participation in advancing markets while maintaining resilience during periods of stress.

SECTOR POSITIONING

Materials and Energy now lead the system, with Utilities remaining a top-tier sector driven by AI-related power demand. These areas are expected to remain meaningful contributors barring a deterioration in rankings.

On the underweight side, software, consumer discretionary, and real estate continue to populate the short book, with limited long opportunities emerging in those segments.

NAVIGATING UNCERTAINTY

The current environment introduces a level of uncertainty that is difficult to model. However, our approach remains unchanged. The system was positioned for this rotation before the catalyst emerged, and it will continue to guide the portfolio as conditions evolve. We remain focused on diversification, disciplined exposure management, and allowing strong themes to compound while exiting positions as rankings deteriorate.

The Even Herd Long Short ETF (EHLS) is a relative momentum-driven long/short equity strategy. For more information, visit evenherd.com/ehls.

The views, opinions and content presented are for informational purposes only. The charts and/or graphs contained herein are for educational purposes only and should not be used to predict security prices or market levels. The information presented in this piece is the opinion of Even Herd and does not reflect the view of any other person or entity.  The information provided is believed to be from reliable sources, but we cannot guarantee the accuracy or completeness of the information, no liability is accepted for any inaccuracies, and no assurances can be made with respect to the results obtained for their use.  The information contained herein may be subject to change at any time without notice. Past performance is not indicative of future results.