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Speaker 1: Welcome trilliance. I'm Joel Webber and I'm americal. Tunis Eric?

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Speaker 1: Are you ready for next year? Yet? Absolutely? So? Over

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Speaker 1: I am, So how about can we get there? Yeah?

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Speaker 1: I mean honestly, this year has felt like a decade,

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Speaker 1: like longer than a decade. Yes, I mean there's been

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Speaker 1: so many phases to it. Something somebody brought up, something

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Speaker 1: that happened in January, and it seemed like four times

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Speaker 1: yeah before times, yeah before I think longingly about the

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Speaker 1: before times. Yeah BC. On this episode of Trillions, we're

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Speaker 1: gonna go into the future. Yeah. Um, we're gonna talk

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Speaker 1: about the future. Yeah. You know, last year and and

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Speaker 1: every half year we coun into these outlooks, and that

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Speaker 1: that term is gets. You know, it's a little beaten

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Speaker 1: down and traite at this point, and we do an outlook,

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Speaker 1: but we thought for this audience, given this sort of

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Speaker 1: retailer ish nature, we would do what we're calling one one.

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Speaker 1: So we're gonna go over t s that we're watching

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Speaker 1: in this coming year. And just to be clear, we

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Speaker 1: do not give investment device. So this is not ets

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Speaker 1: we think we'll go up or down. It's ones that

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Speaker 1: we as analysts just keep thinking about and we're fascinated

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Speaker 1: by and they kind of tap into some bigger themes

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Speaker 1: and topics and so um. So basically we had the

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Speaker 1: whole team, and the team being myself at the Nazia

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Speaker 1: Sera Veagus, James Staffer and Morgan Barna each pick five

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Speaker 1: ETFs and then we all sort of agreed on the

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Speaker 1: twenty one, which we'll go over at the end, but

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Speaker 1: that that's the general idea and we'll we'll go through

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Speaker 1: it during this sub podcast Best time on Brilliant. Okay,

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Speaker 1: so we're going from youngest to oldest, which means James

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Speaker 1: Safer is on the hot seat to go first. James,

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Speaker 1: what's your opening batch of e t F kickers? So

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Speaker 1: my opening batch actually breaks the rules. It's not technically

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Speaker 1: an e t F. It's GBTC. Already you're already not

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Speaker 1: following instruction, years off to a terrible start, but this

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Speaker 1: is something you can't leave off, especially in the environment

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Speaker 1: where and it's the gray scale bitcoin trust. Um so

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Speaker 1: it holds bitcoin. Uh, it's not technically an et F.

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Speaker 1: It's what's known as a grant or trust. Basically, it

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Speaker 1: operates kind of like a closed and fund. It's not

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Speaker 1: the most efficient vehicle in the world, but right now

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Speaker 1: Bitcoin sitting near all time highs, just shy of twenty thousands.

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Speaker 1: The fund itself is now has a market cap of

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Speaker 1: over of around fourteen billion, which is nothing to sneeze

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Speaker 1: at for sure, um, but it's it's taken in a

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Speaker 1: lot of money this year, would be in the top

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Speaker 1: fifty for getting flows this year in so looking to

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Speaker 1: see if this continues into the other five. This that

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Speaker 1: brings up is a bitcoin ETF. This is something that's

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Speaker 1: been talked about since possibly even earlier when the coballs

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Speaker 1: first filed, and it's just the SEC is not letting

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Speaker 1: it happen. Um. So there's kind of a disservice in

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Speaker 1: my opinion, going on here with the SEC allowing this

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Speaker 1: product to operate in the OTC markets where retail investors

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Speaker 1: can buy it, but they can't buy a more efficient

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Speaker 1: actual et F that holds bitcoin. So you have right

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Speaker 1: now this thing on Friday closed at roughly a thirty

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Speaker 1: percent premium to its underlying value, So basically you're paying

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Speaker 1: a thirty percent premium just to get access to this

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Speaker 1: fund that holds bitcoin. UM. So there's a bunch of

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Speaker 1: issues here, But this is the best product you have

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Speaker 1: UM inside the current existing brokerage system. So I'm just

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Speaker 1: gonna see how this goes. And the other thing I'm

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Speaker 1: watching is if a bitcoin e t F does get approved,

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Speaker 1: I think there's a good chance that this product actually

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Speaker 1: gets converted to an e t F, so it will

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Speaker 1: open up at the door at a ten billion dollar

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Speaker 1: product if it converts from a grant of trust to

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Speaker 1: an e t F. Okay number two. Number two is

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Speaker 1: a little more boring. UM. It's v x US, the

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Speaker 1: Vanguard Total International Stock ETF UM. If you look at

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Speaker 1: like global equity land Escape and you slice it the

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Speaker 1: COmON way to slice in three ways, right, so you're

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Speaker 1: looking at domestic equity, international, developed, and then emerging market.

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Speaker 1: If you look at the domestic equity market right now,

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Speaker 1: I mean over the last ten years, domestic stocks have

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Speaker 1: outperformed international stocks by with emerging markets doing slightly worse,

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Speaker 1: an international developed doing slightly better. But it's been an

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Speaker 1: absolute dominant run by domestics. So one we're going I'm

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Speaker 1: watching this to see if international stocks can do some

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Speaker 1: catching up. The other thing I'm watching is v x

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Speaker 1: U S has been around for about ten years has

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Speaker 1: only they've seen three days of outflows. It's just a

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Speaker 1: perpetual parade of inflows, partially because of the underperformance. So

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Speaker 1: people are constantly rebalancing into this. So if that changes,

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Speaker 1: I want to see if this thing starts seeing outflows.

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Speaker 1: Number three, I'm gonna go with SNPE here, which is

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Speaker 1: the Extractor's SMP five E s G E T F UM. Obviously,

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Speaker 1: E s G is a hot topic, it has been

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Speaker 1: for a couple of years UM, which finally starting to

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Speaker 1: see assets go to the space. The other thing here

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Speaker 1: is I like these types of products, they find them

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Speaker 1: more interesting. Um when I mean these types of products.

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Speaker 1: SMP is an exclusionary portfolio. So what it does is

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Speaker 1: it gives you the SMP five hundred and basically takes

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Speaker 1: out the worst actors from each sector and then a

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Speaker 1: couple of other ones like tobacco and weapons. So you're

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Speaker 1: getting broadly the SMP five hundred, but just kind of

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Speaker 1: taking things off the edge that thinks are the worst performers.

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Speaker 1: And the other thing I'm looking at here is there's

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Speaker 1: three other ETFs that track the same exact index. One

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Speaker 1: on the US market, which is E five from Spider

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Speaker 1: and then there's one from Investco in Europe UM which

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Speaker 1: is sp X E, and one in Canada that's e

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Speaker 1: s G. So all of these have about just shy

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Speaker 1: of a billion dollars. So I want to see how

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Speaker 1: quickly those assets grow. Because SMP is obviously pushing this

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Speaker 1: as a as a product, how do they decide what

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Speaker 1: gets excluded? Is it just performance? So each so that

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Speaker 1: it's it's actually a pretty complicated um methodology. Uh. Depending

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Speaker 1: on the sector, it takes certain scores into more more important,

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Speaker 1: so like they might take social more important in this area,

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Speaker 1: or like obviously energy they take into carbon a little

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Speaker 1: more seriously. Um. So different things gets different ways. So

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Speaker 1: the whole idea is just like, based on your sector,

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Speaker 1: we're gonna get rid of the worst things from that

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Speaker 1: sector and we're just gonna give you basic your The

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Speaker 1: goal is to give a risk return characteristics similar to

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Speaker 1: the SMP, which we've done tons of research. We've talked

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Speaker 1: about it on this podcast. The things that are most

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Speaker 1: like beta, the most like what you can put in

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Speaker 1: a core portfolio, tend to get the most assets and

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Speaker 1: interests from advisors. Okay, number four, Um, so I'm gonna

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Speaker 1: go with ov L which is the overlay shares Large

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Speaker 1: cap Equity e t F. There's another one SPU i

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Speaker 1: C from Simplify the Simplify Us Equity plus Convexity e

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Speaker 1: t F. These are structured product ETFs. They have like

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Speaker 1: kind of overlays and it's an interesting market for these.

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Speaker 1: There's a couple of them coming to market. We've talked

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Speaker 1: about the buffer products on here a bunch. We had

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Speaker 1: Bruce Bond on UM. All of these kind of like

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Speaker 1: options strategy e t f s are coming to market.

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Speaker 1: It's a booming area and it's a good time for

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Speaker 1: now with interest rate SOLO, there's a lot of people

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Speaker 1: looking for yield replacement. There's a lot of people saying

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Speaker 1: that you can't just do a sixty forty portfolio. So

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Speaker 1: they're taking a little away from each side and going

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Speaker 1: to these other types of products. UM. Some of them.

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Speaker 1: O VL for instance, is outperformed since it's launch, which

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Speaker 1: so I'm just kind of watching to see both the

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Speaker 1: performance of these things and how well they do at

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Speaker 1: gathering assets. UM. So we'll see and your your fifth

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Speaker 1: and final. So my fifth and final is uh is

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Speaker 1: t q q q UM and also s q q

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Speaker 1: q T q q Q is the triple levered long

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Speaker 1: queues or NASDAQ on t f UM. This thing has

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Speaker 1: shocked US this year. It is the fourth most traded

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Speaker 1: e t f on US exchanges in twenty so far,

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Speaker 1: which is kind of insane for me to think about

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Speaker 1: that a triple leverage product would do it. But that

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Speaker 1: kind of is indicative of two things. One, Robin Hood

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Speaker 1: traders will just use that term, but really retail traders

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Speaker 1: on any platform have balloon or in the pandemic. And also,

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Speaker 1: obviously tech has done extremely well. The cues of outperformed

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Speaker 1: the SP five over a long period of time, and

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Speaker 1: the cues have even outperformed by more. The t q

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Speaker 1: q Q as outperformed by more because basically the way

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Speaker 1: it's leverage, if it's a consistent ride up, it actually

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Speaker 1: will generate more return than the the underlying investment. So

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Speaker 1: basically going to be watching to see two things. One

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Speaker 1: does this outperformance continue and two does that this amount

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Speaker 1: of trading. I mean, this thing trades opens four billion

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Speaker 1: dollars a day um, So is that going to slow

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Speaker 1: down when things start opening up? Their sports back on TV, now,

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Speaker 1: more gambling, more things like that, are people going to

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Speaker 1: leave the trading arena UM from their deaths at home.

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Speaker 1: So all that's gonna be interesting rots in one in

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Speaker 1: my view, Hey Eric, Um, I don't know if you

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Speaker 1: were listening to this, but James picked a ticker that

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Speaker 1: wasn't in et F and then he picked two tickers

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Speaker 1: instead of one. Um, what do we what do you

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Speaker 1: have to say about m and his picks? Well, I

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Speaker 1: think it's on brand. UM. I think James is like

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Speaker 1: when I want to know, like the mindset of a

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Speaker 1: mall Neil day trader. I asked James, he's got Bitcoin,

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Speaker 1: he's got triple leverage cues, and he's got E S

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Speaker 1: G in there and in some you know, option overlay.

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Speaker 1: He's Um, I think they're great. I think all of

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Speaker 1: these are really interesting. I think v x US is

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Speaker 1: the one that's that's a little unexpected from from his picks. UM.

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Speaker 1: That said, you know, waiting for International to catch up

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Speaker 1: or do you know, to have a good run has

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Speaker 1: been something that's been like a five year story. But

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Speaker 1: our chief market strategist, Gina Martin Adams has talked about

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Speaker 1: look out for some rotations next year and one of

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Speaker 1: those is two International. So UM, I think they're great.

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Speaker 1: I think they're all indicative of things that are going

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Speaker 1: to play out next year. I think bitcoin et F,

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Speaker 1: if you have Biden, pick somebody who is just the

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Speaker 1: right person at the SEC, potentially you can see want

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Speaker 1: to prove quickly. Um, but I'm still doubtful. I'll add

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Speaker 1: something and I'm the Bitcoin thing that I think is

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Speaker 1: really interesting. They want to prove it. Um. Europe has

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Speaker 1: a bitcoin tfs already, right and they're performing, uh pretty well.

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Speaker 1: So it's interesting that you have all these approvals in

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Speaker 1: Europe and there's multiple bitcoin ETFs. So I have to

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Speaker 1: think that the SEC is looking over in Europe. You know,

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Speaker 1: usually it's the other way around. Europe's looking to what

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Speaker 1: the U S is doing, but it seems like this

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Speaker 1: time they're looking the other way. Um. So I think

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Speaker 1: depending how some of these products trade, could hopefully open

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Speaker 1: the door and make it a little bit easier for

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Speaker 1: a bitcoin approval in the US. Yeah. And there's a

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Speaker 1: lot of a lot of what aboutism with some of

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Speaker 1: the stuff that Robin Hood people are doing. And then

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Speaker 1: they're like, but there still isn't a bitcoin ETF. You know,

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Speaker 1: we looked a bitcoin e t F ranked by volatility

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Speaker 1: would be wouldn't even be in the top fifty. Um

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Speaker 1: there are there would be you know, dozens of e

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Speaker 1: t A e tps that are more volatile than a

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Speaker 1: bitcoin fund would be. It just has comes down to that,

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Speaker 1: you know, surveillance on exchanges and the possibility of manipulation

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Speaker 1: that the SECC can't seem to get over. But and look,

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Speaker 1: you know over in Sweden they've got they've had they'd

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Speaker 1: launched this stuff a long time ago. There's one over

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Speaker 1: there is five years old and there has not been

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Speaker 1: really much problem with the premium discount. It seemed to

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Speaker 1: do the job exactly as an e t P should.

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Speaker 1: I'm surprised they haven't looked at that and said, okay,

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Speaker 1: well it's worked there five years, let's let's give it

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Speaker 1: a shot. But they're they're they're obsessed with the underlying

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Speaker 1: market more than the how the product will work. And

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Speaker 1: that's the issue, all right. Second youngest analysts morgan um

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Speaker 1: number six e t f I SEB t I shares

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Speaker 1: Convertible bond DTF. So the convertibles market have really ballooned

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Speaker 1: UM this year there was sort of a bull year.

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Speaker 1: We're on track for like a hundred and seventeen billion

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Speaker 1: of issuants UM. This fun tracks of Bloomberg Barkley's US

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Speaker 1: Convertible Cash Pay Bond Index, which is really issuers coming

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Speaker 1: to market for UM, you know, really appealing borrow rates

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Speaker 1: with an equity conversion option. So the the appreciation investors

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Speaker 1: really is linked to the equity growth. But just the

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Speaker 1: nature of the issuers has been super interesting this year.

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Speaker 1: Entrence that were more distressed, like American Airlines were a Caribbean,

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Speaker 1: but also just really fast growing companies that that are

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Speaker 1: looking to you know, lowering or cossa borrowing UM companies

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Speaker 1: like shop High and Novocure. So ultimately with with the

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Speaker 1: conversion option, investors in this fund have seen UM really

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Speaker 1: strong growth like fifty up this year. For for investors

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Speaker 1: who really want to stick to a certain bond allocation,

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Speaker 1: this is kind of an interesting, uh interesting play to

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Speaker 1: do it. Some of the mutual funds have have loads,

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Speaker 1: So I like that the e t F is clean

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Speaker 1: share class and this fund actually only charges twenty BIPs. Okay,

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Speaker 1: number seven, I'm going with q Q q J, which

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Speaker 1: I don't know that one. I know, I know cues,

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Speaker 1: but I don't know Cukuku j Yeah, relatively new, launched

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Speaker 1: in October. It was a an extension of sort of

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Speaker 1: the NASDAC brand Buy invest Go, which is really interesting.

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Speaker 1: It's the next one hundred listed companies on the asset

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Speaker 1: that are non financials, so in line with the QQ

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Speaker 1: brand UM. Obviously, that brand has has had some pretty

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Speaker 1: big strides this year just in notoriety and investors interest

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Speaker 1: in in it. But this, this next one, actually we

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Speaker 1: like that it overlaps with a number of sort of

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Speaker 1: hot thematic categories. Even just looking at the top three holdings,

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Speaker 1: I mean five G content streaming, on demand, internet, ad tech,

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Speaker 1: you know this, This is just sort of intersect with

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Speaker 1: a lot of interesting themes um. So we're watching this fun.

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Speaker 1: We think it's going to get more traction um the

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Speaker 1: coming year. It already has three million in assets. Okay,

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Speaker 1: Number eight. I chose KMD Crane Chairs, Emerging Markets, Healthcare

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Speaker 1: et F. This is a smaller fund, but we've seen

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Speaker 1: as some have have described a bit of like a

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Speaker 1: k recovery. I think, you know, healthcare along with biotech,

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Speaker 1: but really, you know, healthcare and emerging markets has been

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Speaker 1: part of the upper leg of that k UM. They're

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Speaker 1: just some really interesting exposure here among some of the

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Speaker 1: more innovative emerging markets economies. Uh. This fund has a

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Speaker 1: thirty percent allocation in China, twenty to South Korea, thirteen

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Speaker 1: percent Hong Kong, and thirteen percent India. So really those

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Speaker 1: stronger growing emerging market economies right now. Um. The structural

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Speaker 1: I guess play here is that healthcare costs as a

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Speaker 1: share of GDP or supposed to grow a lot faster

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Speaker 1: and emerging markets than developed Um. Just the demographic tell

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Speaker 1: when they're coming along with urbanization. So the fund has

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Speaker 1: seen some some really strong growing names this year, but

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Speaker 1: I think it owes to the construction of it. So

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Speaker 1: it's it's market cap weighted with a cap at four

280
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Speaker 1: point five percent, and then anything over that is distributed

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Speaker 1: prograd at the rest of the holding. So it does

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Speaker 1: feature some some higher weightings and smaller companies. And yeah,

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Speaker 1: I'm watching this one next year. I think I think

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Speaker 1: the demographic trends are going to continue to play. Um. Okay,

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Speaker 1: number nine, I chose that the A T T which

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Speaker 1: is amplifies lithium and battery technology. I was going to say,

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Speaker 1: if this has nothing to do with battery it would

288
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Speaker 1: be like the weirdest tiger of all time. But yeah,

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Speaker 1: glad to know it's battery. This is a battery t

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Speaker 1: F Actually super Interestingly, this fund converted from an actively

291
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Speaker 1: managed UH to an index based strategy in mid October,

292
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Speaker 1: So that's part of why I'm watching it because I

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Speaker 1: think the index based construction is really going to change

294
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Speaker 1: the investment mandate change too. I think this fund is

295
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Speaker 1: going to have a little bit of a different trajectory

296
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Speaker 1: going forward. So they actually notched down their exposure to

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Speaker 1: lithium miners by ten percent. The fund added six energy

298
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Speaker 1: storage makers and now it's including e V auto manufacturers

299
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Speaker 1: in a meaningful way. It's going to try to contain

300
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Speaker 1: those automakers to just the exposure and get more of

301
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Speaker 1: the end to end battery life cycle and still keep

302
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Speaker 1: the miners in there. Um. But know it's at a

303
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Speaker 1: Tesla Neo like a bunch of these these EV makers.

304
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Speaker 1: Though the EV maker has to have top line revenue

305
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Speaker 1: from electric vehicles. But interestingly, the other auto makers as

306
00:16:12,320 --> 00:16:15,040
Speaker 1: they they you know, maybe naturally increase their e V

307
00:16:15,160 --> 00:16:18,760
Speaker 1: output could be considered for this fund. So I think

308
00:16:18,800 --> 00:16:21,920
Speaker 1: the construction is interesting. They even have like sort of

309
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Speaker 1: a market cap minimum for some of the lithium miners

310
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Speaker 1: and other metals producers, so they have to have a

311
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Speaker 1: reasonable share of the market. I think it just tries

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Speaker 1: to add really close to this the sector and the

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Speaker 1: growth in lithium ion battery demand. Okay, and your your

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Speaker 1: tent my my fifth and the tent pick is UH

315
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Speaker 1: NET and et L fundamental income net least rate e

316
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Speaker 1: t F. This is an interesting UH sub segment of

317
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Speaker 1: the of the single Tenant Reaped index in the US.

318
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Speaker 1: So this is this is an index product, but it's

319
00:16:59,560 --> 00:17:04,159
Speaker 1: it's sort of a sub index of only those reads

320
00:17:04,240 --> 00:17:06,960
Speaker 1: that operate with triple netleases, so the managers actually have

321
00:17:07,000 --> 00:17:10,600
Speaker 1: a much better path through of rental income to investors.

322
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Speaker 1: So these tend to be this is a higher yielding

323
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Speaker 1: segment right now, it's around four four four percent. Just

324
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Speaker 1: as a starting point, the BI single tenant read index

325
00:17:19,320 --> 00:17:22,840
Speaker 1: has done fiftcent better than the broader UH North American

326
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Speaker 1: read index. I think that proved some defensibility on the

327
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Speaker 1: single tenant side, and I see that kind of content

328
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Speaker 1: that defensibility kind of continuing next year. This being a

329
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Speaker 1: little bit more of a shielded segment of the real

330
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Speaker 1: estate operators. But you know, I think there's really interesting

331
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Speaker 1: embedded portfolio diversity. This is sort of a big range

332
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Speaker 1: of tenant types. Um and for real estate or or

333
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Speaker 1: a yield sleeve. This is this is an interesting strategy. Eric,

334
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Speaker 1: what do you think about her picks? They're great. Um,

335
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Speaker 1: They're all kind of out of the box stuff. I

336
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Speaker 1: hadn't really thought of. The only one that I was

337
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Speaker 1: I think where the whole team was on was q

338
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Speaker 1: Q Q J. Think this is this product came out.

339
00:18:02,880 --> 00:18:05,399
Speaker 1: Rarely a product gets launched and you're like, God, that

340
00:18:05,520 --> 00:18:07,680
Speaker 1: makes so much sense, Like, I'm surprised they didn't do

341
00:18:07,760 --> 00:18:10,400
Speaker 1: that one sooner. You know, the next one in the cues.

342
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Speaker 1: I suppose that the cues were so on fire this

343
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Speaker 1: year that it just the idea was more natural than

344
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Speaker 1: the years past. But that's a good one. I like.

345
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Speaker 1: I like the e M themes are analysts were off

346
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Speaker 1: for b I, who covers all the emerging markets. He's

347
00:18:25,160 --> 00:18:27,440
Speaker 1: written naturally about themes, even though E t f s

348
00:18:27,440 --> 00:18:30,720
Speaker 1: are not his coverage, and they naturally connect with some

349
00:18:30,880 --> 00:18:33,440
Speaker 1: of the things the issuers have been doing with try

350
00:18:33,520 --> 00:18:36,639
Speaker 1: to unbundle em a little bit, to try to capture

351
00:18:36,680 --> 00:18:39,320
Speaker 1: the more growthy areas and cut out the stuff that

352
00:18:39,320 --> 00:18:42,080
Speaker 1: doesn't grow that fast. And then the battery you know,

353
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Speaker 1: lithium has l I T the competing one has one

354
00:18:45,359 --> 00:18:47,560
Speaker 1: point three billion, which is way more than I thought

355
00:18:47,600 --> 00:18:50,520
Speaker 1: it did. And then the driver the electric driving car

356
00:18:50,720 --> 00:18:52,520
Speaker 1: e t F there's like three of them now they

357
00:18:52,560 --> 00:18:55,399
Speaker 1: also have about half a billion, so there's clearly interest

358
00:18:55,520 --> 00:18:57,280
Speaker 1: in that one. So I also thought that was good.

359
00:18:57,280 --> 00:18:59,840
Speaker 1: And also I see I V C T I rarely

360
00:19:00,000 --> 00:19:03,800
Speaker 1: and think about convertibles, and it's the best performing fixed

361
00:19:03,800 --> 00:19:07,320
Speaker 1: income et F of the year, which again was a shocker.

362
00:19:07,440 --> 00:19:11,080
Speaker 1: So UM, I like, I enjoy being surprised by the picks,

363
00:19:11,119 --> 00:19:14,000
Speaker 1: and I was surprised by like four of these five. Yeah,

364
00:19:14,080 --> 00:19:15,960
Speaker 1: I mean the the I C v T pick is

365
00:19:16,000 --> 00:19:17,760
Speaker 1: the one that jumped out at me, just because when

366
00:19:17,800 --> 00:19:19,240
Speaker 1: she said it and I looked it up, I was like,

367
00:19:19,400 --> 00:19:22,040
Speaker 1: that chart is impressive to look at, UM, And it's

368
00:19:22,080 --> 00:19:24,639
Speaker 1: definitely a unique way that she mentioned to get like

369
00:19:24,840 --> 00:19:27,400
Speaker 1: your your fixed income exposure. I talked about using those

370
00:19:27,480 --> 00:19:31,280
Speaker 1: overlay structured products strategies as kind of like a way

371
00:19:31,359 --> 00:19:34,040
Speaker 1: to change your sixty forty portfolio. Maybe you take a

372
00:19:34,040 --> 00:19:36,080
Speaker 1: little from me to put in those and I think

373
00:19:36,160 --> 00:19:38,200
Speaker 1: I c VT also kind of fits into that theme

374
00:19:38,240 --> 00:19:40,159
Speaker 1: because you get a little more of the equity upside,

375
00:19:40,200 --> 00:19:42,240
Speaker 1: but there's a little more principal protection on the downside

376
00:19:42,280 --> 00:19:46,159
Speaker 1: theoretically because it is it does have a fixed income floor. UM.

377
00:19:46,240 --> 00:19:48,720
Speaker 1: So I think I c BT also fits into that

378
00:19:48,960 --> 00:19:52,760
Speaker 1: theme that I spoke about, UM pretty well. I like

379
00:19:52,960 --> 00:19:55,480
Speaker 1: the q q J pick as well, UM, and I

380
00:19:55,560 --> 00:19:58,919
Speaker 1: like it from the angle that it's a MidCap focus. Um.

381
00:19:59,000 --> 00:20:01,119
Speaker 1: You know, NBUI, which is the mid cap ETF, is

382
00:20:01,280 --> 00:20:03,920
Speaker 1: one of the best performing ETFs of all time, and

383
00:20:04,000 --> 00:20:07,000
Speaker 1: it's traditionally been an area that Nastac just frankly hasn't

384
00:20:07,040 --> 00:20:09,240
Speaker 1: focused on. So they they it's pretty interesting that they

385
00:20:09,280 --> 00:20:11,040
Speaker 1: found that gap and now they're able to compete in

386
00:20:11,080 --> 00:20:14,679
Speaker 1: the MidCap space as well. Terific If keep the mic,

387
00:20:15,600 --> 00:20:19,639
Speaker 1: let's hear what you got alright. UM, My picks aren't

388
00:20:19,640 --> 00:20:22,600
Speaker 1: as hardcore millennial because I grew up in the analog

389
00:20:22,720 --> 00:20:25,239
Speaker 1: world two a little bit, so I've seen them both. Um.

390
00:20:25,320 --> 00:20:27,760
Speaker 1: But the first one I'll start with is a SPG

391
00:20:28,000 --> 00:20:31,399
Speaker 1: p UM. It's the Investo SMP five D GARB e

392
00:20:31,560 --> 00:20:34,960
Speaker 1: t f UM GARB standing for growth at a Reasonable Price,

393
00:20:35,400 --> 00:20:37,560
Speaker 1: But the way I explain this one, it's like it's

394
00:20:37,600 --> 00:20:41,760
Speaker 1: like growth light. You're seeing this transition over to value. Now,

395
00:20:42,119 --> 00:20:44,160
Speaker 1: value has been doing really well. You've seen it come

396
00:20:44,240 --> 00:20:46,960
Speaker 1: up more and more. But if there's one thing that

397
00:20:47,119 --> 00:20:49,640
Speaker 1: history has taught us, it's that anyone who keeps allocating

398
00:20:49,680 --> 00:20:52,960
Speaker 1: the value gets burned. Um. What GARB does is it

399
00:20:53,119 --> 00:20:55,359
Speaker 1: it still doesn't allow you to let go of these

400
00:20:55,440 --> 00:20:58,399
Speaker 1: growth companies, but it down shifts a little bit. So

401
00:20:58,840 --> 00:21:01,119
Speaker 1: if I was to run a chart between growth, value

402
00:21:01,200 --> 00:21:03,960
Speaker 1: and are fall somewhere in the middle. So why I

403
00:21:04,080 --> 00:21:06,359
Speaker 1: like this one is that it's still playing on this

404
00:21:06,480 --> 00:21:09,359
Speaker 1: transition out of growth into value, but it's not fully

405
00:21:09,480 --> 00:21:12,160
Speaker 1: moving over. Sometimes you see this binary move, people will

406
00:21:12,160 --> 00:21:14,159
Speaker 1: move out of growth right into value. This one just

407
00:21:14,240 --> 00:21:16,440
Speaker 1: sort of downshifts a little bit. Um. It's it's a

408
00:21:16,480 --> 00:21:19,320
Speaker 1: really small product. It's not that well known. But the

409
00:21:19,400 --> 00:21:21,240
Speaker 1: other thing I found interesting is that the issue where

410
00:21:21,240 --> 00:21:23,440
Speaker 1: actually changed their strategy. It used to be like a

411
00:21:23,480 --> 00:21:26,280
Speaker 1: full on growth strategy and they change it to GARB.

412
00:21:26,400 --> 00:21:30,720
Speaker 1: So even themselves are inherently making a market call, and

413
00:21:31,119 --> 00:21:33,399
Speaker 1: you know they're being a little bit more water down growth.

414
00:21:33,680 --> 00:21:35,359
Speaker 1: So I think this is a really interesting one to

415
00:21:35,400 --> 00:21:40,640
Speaker 1: watch for next year. Number twelve. Number twelve is I Buy,

416
00:21:40,840 --> 00:21:44,879
Speaker 1: which is the Amplifi Online Retail et F. No, I

417
00:21:44,880 --> 00:21:46,879
Speaker 1: don't need to sell you on the story of online

418
00:21:46,920 --> 00:21:49,320
Speaker 1: retail and how well that's doing, but why I like

419
00:21:49,480 --> 00:21:50,920
Speaker 1: this one and I call it sort of the non

420
00:21:51,119 --> 00:21:54,080
Speaker 1: Amazon e t F. So when you look at a

421
00:21:54,080 --> 00:21:57,639
Speaker 1: lot of these uh consumer discretionary or online retail product

422
00:21:57,720 --> 00:22:01,760
Speaker 1: they are dominated by Amazon. Usually anyway from fifteen of

423
00:22:01,840 --> 00:22:04,560
Speaker 1: the product is Amazon. This only has a two percent

424
00:22:04,640 --> 00:22:07,639
Speaker 1: way to Amazon because it's equal weighted. And even with that,

425
00:22:07,840 --> 00:22:10,199
Speaker 1: the ETF is up over a hundred percent this year,

426
00:22:10,240 --> 00:22:13,239
Speaker 1: which is like the fifth best performing ETF out there. UM.

427
00:22:13,960 --> 00:22:15,719
Speaker 1: And I'm really I like this product because it comes

428
00:22:15,760 --> 00:22:19,600
Speaker 1: from a smaller issue from Amplified. Um It's it's capitalizing

429
00:22:19,680 --> 00:22:22,399
Speaker 1: on the online retail trend, but it's not Amazon. UM.

430
00:22:22,640 --> 00:22:24,919
Speaker 1: So there's all these other names there, so much happening

431
00:22:24,920 --> 00:22:27,720
Speaker 1: in the ecosystem outside of them Amazon. A otther of

432
00:22:27,720 --> 00:22:31,320
Speaker 1: people forget that, and this, this product brings all these

433
00:22:31,359 --> 00:22:33,000
Speaker 1: smaller companies to light. And as you can see, they're

434
00:22:33,000 --> 00:22:35,960
Speaker 1: all performing really well because, um, most of the performance

435
00:22:35,960 --> 00:22:39,280
Speaker 1: has been outside of the the Amazon story. What are

436
00:22:39,359 --> 00:22:42,040
Speaker 1: some other whole things that you like in there. Yeah,

437
00:22:42,119 --> 00:22:45,520
Speaker 1: So like Roku is a big one that comes up garment.

438
00:22:45,960 --> 00:22:48,800
Speaker 1: So there's all these other companies that are still capitalizing

439
00:22:48,840 --> 00:22:53,159
Speaker 1: office online retail trend. But Amazon like the twenty or

440
00:22:53,200 --> 00:22:55,800
Speaker 1: something or so biggest holding. So that's why I really

441
00:22:55,840 --> 00:22:58,920
Speaker 1: like it. It really takes the focus off of Amazon. Okay,

442
00:22:59,040 --> 00:23:02,959
Speaker 1: number thirteen, This is my millennial pick. It's the Spack

443
00:23:03,440 --> 00:23:06,000
Speaker 1: e t F to definance the next gen SPAC derived

444
00:23:06,400 --> 00:23:08,840
Speaker 1: e t F. Now this one is still really small

445
00:23:08,880 --> 00:23:10,399
Speaker 1: to when you got a few million in it and

446
00:23:10,480 --> 00:23:13,960
Speaker 1: it just launched, But this one seems to check a

447
00:23:14,080 --> 00:23:16,639
Speaker 1: lot of the boxes for these thematic ETFs that do

448
00:23:16,960 --> 00:23:20,880
Speaker 1: really well. Um, it had interest right out of the gate.

449
00:23:20,920 --> 00:23:23,359
Speaker 1: It started trading very heavily. Um you know, it's it's

450
00:23:23,440 --> 00:23:28,400
Speaker 1: capitalizing on this robin hood uh investor base that's looking

451
00:23:28,480 --> 00:23:31,639
Speaker 1: more and more. Thematic spacts obviously have had a fantastic year.

452
00:23:31,680 --> 00:23:34,720
Speaker 1: There's something seventy billion or so raised through spacts this year,

453
00:23:35,480 --> 00:23:39,159
Speaker 1: which is a record. So, um, this SPAC one, it

454
00:23:39,320 --> 00:23:41,359
Speaker 1: checks all the boxes that should do well. I'm actually

455
00:23:41,359 --> 00:23:43,440
Speaker 1: a little bit surprised that it's smaller than it really is.

456
00:23:43,520 --> 00:23:45,560
Speaker 1: But I'd be on the lookout next year, um, because

457
00:23:45,600 --> 00:23:47,080
Speaker 1: it's the only e t F I'll do to play

458
00:23:47,119 --> 00:23:49,960
Speaker 1: SPACs in any way, unless you're buying the specific spacts themselves.

459
00:23:50,359 --> 00:23:53,119
Speaker 1: So um, this one's more of my shocking pick that

460
00:23:53,280 --> 00:23:54,639
Speaker 1: I thought this one would be a lot bigger. And

461
00:23:54,680 --> 00:23:57,120
Speaker 1: also just given how strong thematics have been this year,

462
00:23:57,240 --> 00:23:59,400
Speaker 1: pretty much any thematic ETF has come to the market

463
00:23:59,480 --> 00:24:01,960
Speaker 1: has done really well. They share very early on. So

464
00:24:02,280 --> 00:24:05,159
Speaker 1: I'm a little bit surprised that there's not more bites

465
00:24:05,200 --> 00:24:09,879
Speaker 1: on this back et F yet. Okay, fourteen fourteen is

466
00:24:09,920 --> 00:24:12,879
Speaker 1: a classic. It's us m V which is the I

467
00:24:12,960 --> 00:24:16,120
Speaker 1: S share is minvol et F. And why I brought

468
00:24:16,200 --> 00:24:18,199
Speaker 1: this one back in is because if you look at

469
00:24:18,240 --> 00:24:21,200
Speaker 1: flows this year, it's the first year ever that low

470
00:24:21,320 --> 00:24:23,840
Speaker 1: vall is going to have outflows. Um, And I think

471
00:24:23,920 --> 00:24:27,439
Speaker 1: it's it's more of this foamo right. Low vall tends

472
00:24:27,520 --> 00:24:30,800
Speaker 1: to do well and down markets, uh and tends the

473
00:24:30,880 --> 00:24:32,680
Speaker 1: lag on the way up. And what I thought it

474
00:24:32,760 --> 00:24:35,479
Speaker 1: was interesting because given how volable the market was this year,

475
00:24:35,520 --> 00:24:38,399
Speaker 1: supposed to be in March, these tend to take in assets,

476
00:24:38,640 --> 00:24:41,480
Speaker 1: but they've really been bleeding pretty significantly. And if you

477
00:24:41,600 --> 00:24:44,719
Speaker 1: had bought Loval this shure you're actually lagging SNP by

478
00:24:45,480 --> 00:24:48,840
Speaker 1: which I think is a really significant a significant amount

479
00:24:49,240 --> 00:24:52,200
Speaker 1: to get this on people's radar. So, given what we've

480
00:24:52,240 --> 00:24:54,560
Speaker 1: seen with the FED jumping in and really having the

481
00:24:54,680 --> 00:24:57,560
Speaker 1: markets back, UM, I don't see a lot of interest

482
00:24:57,640 --> 00:24:58,720
Speaker 1: in the U S n B. I think a lot

483
00:24:58,760 --> 00:25:00,639
Speaker 1: of people want to go into the high beta stuff.

484
00:25:00,680 --> 00:25:04,000
Speaker 1: So you're seeing investors move out of low vall and

485
00:25:04,160 --> 00:25:07,280
Speaker 1: it's UM. It's interesting because it's every year it's it's

486
00:25:07,320 --> 00:25:09,480
Speaker 1: been taking in money. It's been good for a couple

487
00:25:09,560 --> 00:25:11,720
Speaker 1: billion every year for some of these issues. But this

488
00:25:11,840 --> 00:25:14,280
Speaker 1: year has been a complete reversal of historically we've seen

489
00:25:14,359 --> 00:25:17,920
Speaker 1: with Manvall okay and your final Okay. The last one

490
00:25:18,160 --> 00:25:21,800
Speaker 1: is a active, non transparent ETF or ANTS as we're

491
00:25:21,920 --> 00:25:24,600
Speaker 1: coining it UM the tickers F d G, which is

492
00:25:24,600 --> 00:25:28,280
Speaker 1: the American Century Focused Dynamic Growth ETF. It's so it's

493
00:25:28,320 --> 00:25:30,800
Speaker 1: a long name, but this one is really my bell

494
00:25:30,880 --> 00:25:34,080
Speaker 1: weather for ants and how well ants are going to do. UM.

495
00:25:34,359 --> 00:25:36,800
Speaker 1: They're really new, right, UM. And the whole point of

496
00:25:36,840 --> 00:25:39,119
Speaker 1: ANTS was that these active funds cannot launch and not

497
00:25:39,280 --> 00:25:42,720
Speaker 1: have to show their holdings daily. UM. So the holdings

498
00:25:42,760 --> 00:25:44,800
Speaker 1: are a little bit lagged, but the performance of this

499
00:25:44,960 --> 00:25:47,880
Speaker 1: has been really good. It's already beating the its benchmark

500
00:25:47,960 --> 00:25:51,280
Speaker 1: by it only launched this year. It has about two

501
00:25:51,640 --> 00:25:54,800
Speaker 1: million dollars in assets. Now we debate this on the

502
00:25:54,880 --> 00:25:57,359
Speaker 1: team that's you know when somewhere more bullish on ants

503
00:25:57,400 --> 00:25:59,360
Speaker 1: than others. But I think this one is if there's

504
00:25:59,400 --> 00:26:01,760
Speaker 1: one that has chance of the group, this is going

505
00:26:01,840 --> 00:26:03,320
Speaker 1: to be the best one. I think. I think it's

506
00:26:03,359 --> 00:26:06,760
Speaker 1: the most interesting strategy that holds names like tesla Um.

507
00:26:06,920 --> 00:26:08,399
Speaker 1: This one is really going to be I think my

508
00:26:08,520 --> 00:26:12,200
Speaker 1: bell Weather to see how well people are are are

509
00:26:12,840 --> 00:26:16,200
Speaker 1: accepting of these new and e t f s. Hey, Morgan,

510
00:26:16,240 --> 00:26:20,159
Speaker 1: how come you didn't pick his spack pick? What why

511
00:26:20,200 --> 00:26:22,760
Speaker 1: did you pass on that? You know? I like the pick.

512
00:26:23,040 --> 00:26:26,320
Speaker 1: I think it's I think it's really interesting. Um, we'll

513
00:26:26,359 --> 00:26:29,040
Speaker 1: have to see, I mean, based on sort of the

514
00:26:29,400 --> 00:26:31,879
Speaker 1: market cap waiting in these like you know, how they

515
00:26:31,960 --> 00:26:34,720
Speaker 1: really play out. Um, this is kind of the second

516
00:26:34,800 --> 00:26:37,040
Speaker 1: go I think spac's got a bad name early on,

517
00:26:37,480 --> 00:26:41,199
Speaker 1: but I think you know, the diversity of of UH managers,

518
00:26:42,000 --> 00:26:44,679
Speaker 1: you know, listing and the expediency to which they can

519
00:26:44,800 --> 00:26:47,320
Speaker 1: they can bring things publicum, this is this might be

520
00:26:48,280 --> 00:26:50,720
Speaker 1: a better round on the first. So yeah, and the

521
00:26:50,880 --> 00:26:52,600
Speaker 1: Spack e t F. The the one thing that I

522
00:26:52,840 --> 00:26:54,360
Speaker 1: that you have to point out is that it's only

523
00:26:55,080 --> 00:26:57,399
Speaker 1: pre I p O SPACs. Those are where you get

524
00:26:57,440 --> 00:27:01,000
Speaker 1: the big pop is after the I p O and

525
00:27:01,119 --> 00:27:04,680
Speaker 1: it's lagging the market this year. It's new, but this

526
00:27:04,800 --> 00:27:06,159
Speaker 1: is one of those E t F that has to

527
00:27:06,200 --> 00:27:09,280
Speaker 1: have some shiny object performance I think, and then people

528
00:27:09,280 --> 00:27:11,080
Speaker 1: will go, oh, yeah, of course this would go up.

529
00:27:11,119 --> 00:27:12,720
Speaker 1: This is like the new I p O market, but

530
00:27:12,840 --> 00:27:14,920
Speaker 1: it needs that performance first. I think that's why I

531
00:27:14,960 --> 00:27:18,720
Speaker 1: think it hasn't really found a lot of It hasn't

532
00:27:18,720 --> 00:27:20,600
Speaker 1: found a big audience yet. Yeah, and this year, I

533
00:27:20,640 --> 00:27:24,160
Speaker 1: mean no road shows. It's kind of interesting that after

534
00:27:24,359 --> 00:27:26,760
Speaker 1: I p O ing, they still didn't get marketed that

535
00:27:26,840 --> 00:27:30,520
Speaker 1: aggressively before I p O. So you know, structurally they

536
00:27:30,600 --> 00:27:33,879
Speaker 1: may they may still get that distribution benefits spread out

537
00:27:33,920 --> 00:27:37,680
Speaker 1: over a bit of time. Comment on Spack real quick.

538
00:27:38,400 --> 00:27:41,000
Speaker 1: It s p a C special purpose acquisition company. The

539
00:27:41,080 --> 00:27:43,040
Speaker 1: e t F is actually s p a K. If

540
00:27:43,080 --> 00:27:44,639
Speaker 1: anyone out there is trying to look up the C

541
00:27:44,760 --> 00:27:47,200
Speaker 1: t F and learn about it, which every time I

542
00:27:47,240 --> 00:27:48,639
Speaker 1: got to look at it. I type in s P

543
00:27:48,760 --> 00:27:54,880
Speaker 1: A C and it goes to a delisted company. Um. Yeah.

544
00:27:55,080 --> 00:27:58,359
Speaker 1: I like the guard PTF, mostly because I genuinely didn't

545
00:27:58,359 --> 00:28:00,199
Speaker 1: even know it existed until eight and brought it up

546
00:28:00,680 --> 00:28:04,040
Speaker 1: when we had our pre talk meeting about this. So uh.

547
00:28:04,160 --> 00:28:07,200
Speaker 1: And I love the idea of growth light, just kind

548
00:28:07,200 --> 00:28:09,440
Speaker 1: of looking at and seeing both the performance and whether

549
00:28:09,560 --> 00:28:12,639
Speaker 1: or not advisors retail investors put their money there. Um,

550
00:28:12,800 --> 00:28:14,840
Speaker 1: it'll be interesting to watch and there's not many others

551
00:28:15,080 --> 00:28:18,520
Speaker 1: that that go after this GARB type strategy. I also

552
00:28:18,560 --> 00:28:20,359
Speaker 1: thought it was interesting that he picked us m V.

553
00:28:20,960 --> 00:28:23,320
Speaker 1: That's one that we've been talking about for years. It's

554
00:28:23,359 --> 00:28:27,119
Speaker 1: a beast what is it thirty billion dollars at this point. Um,

555
00:28:27,320 --> 00:28:29,920
Speaker 1: it's such an easy E t F to sell, right.

556
00:28:30,280 --> 00:28:32,160
Speaker 1: Oh hey, it's the market but with a little less

557
00:28:32,359 --> 00:28:35,080
Speaker 1: you know, volatility or a little less edge, and that's

558
00:28:35,119 --> 00:28:37,840
Speaker 1: always good. It's like diet coke and it's it's basically

559
00:28:37,920 --> 00:28:39,720
Speaker 1: flow off the shelves. But the problem is it's trailing

560
00:28:39,760 --> 00:28:41,920
Speaker 1: the market badly this year, and it shows that some

561
00:28:42,040 --> 00:28:44,800
Speaker 1: of the people in there are fickle. Here's my question

562
00:28:44,880 --> 00:28:47,120
Speaker 1: for both us m V and f d G which

563
00:28:47,200 --> 00:28:49,600
Speaker 1: is a theme I'm gonna look into a lot more

564
00:28:49,680 --> 00:28:52,160
Speaker 1: next year, which is do you get a second bite

565
00:28:52,160 --> 00:28:55,760
Speaker 1: at the apple? Remember currency hedge ttfs, like, really, we're

566
00:28:55,800 --> 00:28:57,520
Speaker 1: on fire. For a couple of years they took in

567
00:28:57,680 --> 00:28:59,920
Speaker 1: I don't know what their peak asset was, maybe sixty billion,

568
00:29:00,680 --> 00:29:03,680
Speaker 1: but then they started underperforming and a large chunk of

569
00:29:03,760 --> 00:29:06,240
Speaker 1: the people left. The assets went down because the market

570
00:29:06,360 --> 00:29:09,520
Speaker 1: was down too, and they were a fraction of their

571
00:29:09,520 --> 00:29:13,440
Speaker 1: old selves. Then they started out performing again and nobody cared. Well,

572
00:29:13,560 --> 00:29:16,160
Speaker 1: U SMV get a second look. If it starts out performing,

573
00:29:16,280 --> 00:29:18,600
Speaker 1: we'll see f DG is in the same boat. You've

574
00:29:18,600 --> 00:29:21,200
Speaker 1: got all these ants. They all have names that you

575
00:29:21,240 --> 00:29:24,800
Speaker 1: remember from the nineties, and it be curious to see

576
00:29:24,800 --> 00:29:28,080
Speaker 1: if somebody goes, Wow, this American Century Fund is really

577
00:29:28,120 --> 00:29:30,680
Speaker 1: doing well, or if they go, yeah, no, I've been there,

578
00:29:30,720 --> 00:29:33,840
Speaker 1: done that. I'm gonna look elsewhere to the next thing,

579
00:29:33,960 --> 00:29:36,360
Speaker 1: you know, maybe like the new Goldman Smart Beta, Like

580
00:29:36,640 --> 00:29:39,160
Speaker 1: I just don't I'm a little hesitant that you get

581
00:29:39,200 --> 00:29:42,040
Speaker 1: a second bite of the apple, and so I'm I'm

582
00:29:42,160 --> 00:29:44,480
Speaker 1: a little bearish in the last two. But they're still

583
00:29:44,520 --> 00:29:46,560
Speaker 1: interesting to watch. That has nothing to do with why

584
00:29:46,640 --> 00:29:49,120
Speaker 1: they are good or bad picks. It's more just my

585
00:29:49,240 --> 00:29:51,400
Speaker 1: take on on their potential for assets in the future.

586
00:29:56,640 --> 00:30:00,520
Speaker 1: All right, let's uh, here are you're five? Bring us home.

587
00:30:01,120 --> 00:30:03,160
Speaker 1: My first pick is the one that I'm the most

588
00:30:03,240 --> 00:30:05,440
Speaker 1: excited to watch all next year, which is the d

589
00:30:05,600 --> 00:30:08,480
Speaker 1: f AU. It's the Dimensional US Core Equity Market et F.

590
00:30:09,320 --> 00:30:12,040
Speaker 1: This is the dimensional is a three D and seventy

591
00:30:12,080 --> 00:30:15,320
Speaker 1: billion dollar active manager. It's our One of our themes

592
00:30:15,400 --> 00:30:18,080
Speaker 1: next year is big Active, sort of like big Pharma.

593
00:30:18,160 --> 00:30:21,680
Speaker 1: It's all these big active shops are finally coming in

594
00:30:22,360 --> 00:30:26,400
Speaker 1: full fullheartedly in the next couple of years. And we

595
00:30:26,520 --> 00:30:28,880
Speaker 1: just talked about ants. D f A is taking a

596
00:30:28,880 --> 00:30:30,720
Speaker 1: different approach. They're gonna put their et F out with

597
00:30:31,000 --> 00:30:33,320
Speaker 1: with transparent so they're not doing the ANT approach. They're

598
00:30:33,320 --> 00:30:35,680
Speaker 1: just gonna let you see the holdings every day and

599
00:30:35,920 --> 00:30:38,160
Speaker 1: it's gonna it's an act of strategy. So they're gonna,

600
00:30:38,280 --> 00:30:41,080
Speaker 1: you know, pick stocks. Although it's based on systemic quant

601
00:30:41,120 --> 00:30:44,120
Speaker 1: methods that they do um and this is a firm

602
00:30:44,160 --> 00:30:47,160
Speaker 1: seeing a lot of outflows, so you know, can they

603
00:30:47,240 --> 00:30:49,520
Speaker 1: turn it around? And now, to me, this e t

604
00:30:49,680 --> 00:30:53,560
Speaker 1: F is like custom made for the advisor's brain. It's transparent,

605
00:30:54,080 --> 00:30:56,760
Speaker 1: it's dirt cheap. At twelve basis points, you've got a

606
00:30:56,800 --> 00:30:59,520
Speaker 1: brand name like d f A, but at Vanguard fees

607
00:30:59,520 --> 00:31:03,200
Speaker 1: it's got low tracking. The top holdings are basically Apple, Microsoft, Amazon,

608
00:31:03,360 --> 00:31:08,160
Speaker 1: Amazon only market share. To me, they took the page

609
00:31:08,200 --> 00:31:11,160
Speaker 1: out of Goldman's playbook when Goldman launched g SLC. And

610
00:31:11,240 --> 00:31:13,880
Speaker 1: remember we did the episode with Colfinberg. This is similar

611
00:31:13,920 --> 00:31:16,480
Speaker 1: to that and that worked. That has ten billion dollars.

612
00:31:16,840 --> 00:31:18,680
Speaker 1: And the beauty of these strategies is they're kind of

613
00:31:18,720 --> 00:31:23,320
Speaker 1: performance proof because the advisor is so scared of getting

614
00:31:23,360 --> 00:31:25,680
Speaker 1: fired that they just want to pick stuff that has

615
00:31:25,960 --> 00:31:28,680
Speaker 1: a good story but won't underperform. And this looks like

616
00:31:28,760 --> 00:31:31,240
Speaker 1: it will not because it's so close to the SMP.

617
00:31:31,840 --> 00:31:33,720
Speaker 1: And I think that's something you should see. Also, d

618
00:31:33,880 --> 00:31:35,640
Speaker 1: f A is going to convert a bunch of mutual

619
00:31:35,640 --> 00:31:40,040
Speaker 1: funds that equal twenty billion in assets. So and that's

620
00:31:40,080 --> 00:31:42,200
Speaker 1: also something that Wall Street banks like JP Morgan and

621
00:31:42,240 --> 00:31:44,800
Speaker 1: Goldman did when they entered. They did a lot of

622
00:31:44,840 --> 00:31:47,360
Speaker 1: B Y O A and they look for opportunities to

623
00:31:47,440 --> 00:31:50,920
Speaker 1: grow their assets quickly. So Golden JP Morgan skipped a

624
00:31:51,000 --> 00:31:55,479
Speaker 1: lot of the sort of oblivion stage of a lot

625
00:31:55,560 --> 00:31:58,280
Speaker 1: of legacy companies coming in late where they just hanging oblivion.

626
00:31:58,320 --> 00:32:01,200
Speaker 1: So they finally do something different and they just ripped

627
00:32:01,200 --> 00:32:02,600
Speaker 1: the band aid off and that's what d f A

628
00:32:02,720 --> 00:32:04,760
Speaker 1: did and I have I'm more bullish on them than

629
00:32:04,800 --> 00:32:06,760
Speaker 1: the ants in terms of big active but we'll see.

630
00:32:07,120 --> 00:32:10,400
Speaker 1: Um the next one, speaking of active, Yeah, next one, uh,

631
00:32:10,560 --> 00:32:13,480
Speaker 1: speaking of active arc a r KK. We don't even

632
00:32:13,480 --> 00:32:14,840
Speaker 1: need to spend that much time to describing this. This

633
00:32:14,960 --> 00:32:20,120
Speaker 1: is Cathy Woods. You know super you know lud chrous mode. Yeah,

634
00:32:20,240 --> 00:32:23,880
Speaker 1: she's in luded, like she's gone plaid. That's a deep

635
00:32:23,880 --> 00:32:26,920
Speaker 1: Spaceballs reference. But yeah, she's on another level. I mean

636
00:32:27,360 --> 00:32:28,840
Speaker 1: a r k K. Let me give you the numbers

637
00:32:28,920 --> 00:32:32,800
Speaker 1: up inception and a hundred and thirty three percent this year.

638
00:32:33,000 --> 00:32:37,040
Speaker 1: That's triple the cues, eight times the SMP and two

639
00:32:37,200 --> 00:32:40,200
Speaker 1: times the Fidelity Growth Fund. Now that Fidelity Growth manager

640
00:32:40,400 --> 00:32:42,960
Speaker 1: is tasked with the same thing to pick road stocks,

641
00:32:43,160 --> 00:32:46,640
Speaker 1: so she's doubling a growth manager. That is how on

642
00:32:46,800 --> 00:32:50,680
Speaker 1: fire she is. And she's inspired like about thirty copycat funds.

643
00:32:50,720 --> 00:32:54,000
Speaker 1: So this will be one we watch for a long time. Um.

644
00:32:54,560 --> 00:32:57,280
Speaker 1: Here's the thing though, as you all know, here I'm

645
00:32:57,280 --> 00:33:00,080
Speaker 1: working on this book about Bogel. So I've been reading

646
00:33:00,080 --> 00:33:02,560
Speaker 1: a bunch of his books and it's hard. You know,

647
00:33:02,600 --> 00:33:04,280
Speaker 1: when you read his books, he goes over the go

648
00:33:04,440 --> 00:33:07,160
Speaker 1: go eras from the sixties and the seventies that they

649
00:33:07,200 --> 00:33:10,320
Speaker 1: happened like once every fifteen years, or uh, sell off

650
00:33:10,400 --> 00:33:13,400
Speaker 1: happens once every fifteen years, and you realize there's funds

651
00:33:13,480 --> 00:33:16,000
Speaker 1: like this in every era, and they end up getting

652
00:33:16,040 --> 00:33:19,040
Speaker 1: a lot of assets, people say their geniuses, and then

653
00:33:19,240 --> 00:33:21,600
Speaker 1: a crash hits or a correction, and they usually go

654
00:33:21,640 --> 00:33:24,320
Speaker 1: down more than than the market and people leave and

655
00:33:24,440 --> 00:33:27,120
Speaker 1: then what they get back going again, but nobody cares

656
00:33:27,600 --> 00:33:29,680
Speaker 1: or they can never get back to that again. It's

657
00:33:29,720 --> 00:33:32,360
Speaker 1: the second bite of the apple. Is she a star

658
00:33:32,480 --> 00:33:34,520
Speaker 1: here to stay? Or more like a comment? And that's

659
00:33:34,560 --> 00:33:38,200
Speaker 1: something that we're going to find out. UM s val

660
00:33:38,440 --> 00:33:41,320
Speaker 1: this is the it's opposite of Cathy Wood. This is

661
00:33:41,440 --> 00:33:45,360
Speaker 1: the small cap value e t F from I Shares. UH.

662
00:33:45,520 --> 00:33:48,280
Speaker 1: It's you know, it's a small cat value stocks. It's

663
00:33:48,280 --> 00:33:52,120
Speaker 1: got a quant screen for liquidity, um volatility, leverage, and

664
00:33:52,200 --> 00:33:54,840
Speaker 1: an analyst sentiments. It's got a smart cap smart beta

665
00:33:54,960 --> 00:33:58,360
Speaker 1: kind of filter, and then it ranks this highest scoring stocks.

666
00:33:58,920 --> 00:34:01,360
Speaker 1: UM the top two fifth. Now, I like that it's

667
00:34:01,440 --> 00:34:04,360
Speaker 1: concentrated to fifty means you're gonna rip when it works,

668
00:34:04,840 --> 00:34:07,040
Speaker 1: and that's what happened when you look at the small

669
00:34:07,120 --> 00:34:11,520
Speaker 1: cap value run. That happened from basically since the vaccine

670
00:34:11,840 --> 00:34:15,279
Speaker 1: from Feiser was was that news broke for about three weeks,

671
00:34:15,320 --> 00:34:18,360
Speaker 1: there was a huge rotation the quote reopening trade and

672
00:34:18,480 --> 00:34:21,759
Speaker 1: this thing was up twenty m one per cent during

673
00:34:21,800 --> 00:34:24,680
Speaker 1: that time, more than the other small cap value et

674
00:34:24,840 --> 00:34:26,600
Speaker 1: f s, which hold more stocks, so they're gonna be

675
00:34:26,600 --> 00:34:29,440
Speaker 1: a little more anchored. UM. So I think if you

676
00:34:29,560 --> 00:34:33,280
Speaker 1: have a regime change, we're small cap value or value

677
00:34:33,360 --> 00:34:35,840
Speaker 1: or small caps just you know, has a five or

678
00:34:35,920 --> 00:34:38,560
Speaker 1: ten year run, this thing probably will be at the

679
00:34:38,600 --> 00:34:41,879
Speaker 1: top of the list performance wise because of that concentration.

680
00:34:42,320 --> 00:34:45,439
Speaker 1: It's also very cheap for a potential shiny object type

681
00:34:45,480 --> 00:34:48,440
Speaker 1: ETF at twenty bits. Normally you only step pricing for

682
00:34:48,520 --> 00:34:51,520
Speaker 1: the ones that are sort of more disguise beta. UM.

683
00:34:51,800 --> 00:34:53,800
Speaker 1: The other final note on this is, I don't know

684
00:34:53,880 --> 00:34:55,640
Speaker 1: what's going to happen. We could have, like the Queues

685
00:34:55,719 --> 00:34:58,359
Speaker 1: have another amazing decade, But I just want to remind

686
00:34:58,400 --> 00:35:00,680
Speaker 1: people that in the two thousands that's a decade before

687
00:35:00,760 --> 00:35:03,120
Speaker 1: this last one. If you look at the return, small

688
00:35:03,200 --> 00:35:07,400
Speaker 1: cap value return returns seven point five percent annually that decade.

689
00:35:07,800 --> 00:35:10,839
Speaker 1: The SMP returned nothing, and so in the twenty years

690
00:35:10,920 --> 00:35:14,399
Speaker 1: since then, small cat values still beating the SMP. That's

691
00:35:14,400 --> 00:35:17,440
Speaker 1: how bad corrections are for the SMP UM. And it

692
00:35:17,480 --> 00:35:19,960
Speaker 1: also just shows you that things do change. So again

693
00:35:20,000 --> 00:35:22,120
Speaker 1: I'm sort of looking forward to if and when there

694
00:35:22,120 --> 00:35:24,839
Speaker 1: could be a regime change, look for s vl UM.

695
00:35:25,200 --> 00:35:27,600
Speaker 1: My other one is another one is m s o S.

696
00:35:27,680 --> 00:35:31,840
Speaker 1: This is the advisor Shares Pure Cannabis etf UM. I

697
00:35:31,920 --> 00:35:34,680
Speaker 1: work with Ken scha or cannabis analyst a lot and

698
00:35:34,800 --> 00:35:37,800
Speaker 1: he has some great data showing that like legal cannabis

699
00:35:37,800 --> 00:35:40,279
Speaker 1: sales in the US may hit sixteen billion this year

700
00:35:40,760 --> 00:35:43,520
Speaker 1: versus only two point eight billion for Canada. Yet most

701
00:35:43,560 --> 00:35:46,840
Speaker 1: of the exposure in the potty tfs is in Canadian companies.

702
00:35:47,400 --> 00:35:50,560
Speaker 1: The reason for that is because UM, you're not really

703
00:35:50,600 --> 00:35:53,320
Speaker 1: allowed to invest directly and what's called multi state operators

704
00:35:53,360 --> 00:35:56,160
Speaker 1: in the US. So this e t F uses swaps

705
00:35:56,239 --> 00:36:00,120
Speaker 1: to sort of cleverly sidestep that rule. Long story or

706
00:36:00,280 --> 00:36:04,920
Speaker 1: it's basically a US exposure UM with that going to

707
00:36:05,000 --> 00:36:07,520
Speaker 1: the M S O S. So that's the way more

708
00:36:07,600 --> 00:36:10,040
Speaker 1: than any others. So these are companies like Green Thumb,

709
00:36:10,600 --> 00:36:14,560
Speaker 1: truely pure Leaf. They're all significantly up. And if you

710
00:36:14,640 --> 00:36:16,920
Speaker 1: look at M S O S versus MJ, it's up

711
00:36:18,320 --> 00:36:23,040
Speaker 1: since versus so again, not having those Canadian companies could

712
00:36:23,120 --> 00:36:26,040
Speaker 1: really help this thing in the future. UM. And then

713
00:36:26,160 --> 00:36:29,360
Speaker 1: my final pick is boring but beautiful b t I.

714
00:36:29,960 --> 00:36:32,680
Speaker 1: This is the Vanguard total market. To me, this is

715
00:36:32,719 --> 00:36:36,239
Speaker 1: the perfect e t F. It's pretty much flawless. I

716
00:36:36,360 --> 00:36:38,759
Speaker 1: have My opinion is this is the most likely to

717
00:36:38,840 --> 00:36:41,319
Speaker 1: take over. Spy is the biggest d t F UM

718
00:36:41,440 --> 00:36:43,880
Speaker 1: in the next five or ten years, even though i

719
00:36:44,040 --> 00:36:46,719
Speaker 1: VV has more. This is the third biggest currently. But

720
00:36:46,840 --> 00:36:49,040
Speaker 1: here's here's why I gotta watch out for this one.

721
00:36:49,400 --> 00:36:52,400
Speaker 1: The test less situation with the SNP. To me, I

722
00:36:52,480 --> 00:36:55,759
Speaker 1: think it may have hurt the SMP brand. I don't know.

723
00:36:55,920 --> 00:36:58,840
Speaker 1: It's an amazing brand, it's rock star. Maybe it's just

724
00:36:58,960 --> 00:37:01,759
Speaker 1: beyond that kind of stuff. But the idea that that

725
00:37:02,160 --> 00:37:06,320
Speaker 1: SMP the s is gonna lag beta e t F

726
00:37:06,400 --> 00:37:08,920
Speaker 1: such as the Russell one thousand or the Bloomberg five hundred,

727
00:37:09,640 --> 00:37:11,600
Speaker 1: I don't know. It could it could irk people um

728
00:37:11,800 --> 00:37:15,080
Speaker 1: that Tesla not having it costed about one percent this year.

729
00:37:15,320 --> 00:37:18,239
Speaker 1: Now v t I invested in everything. So v t

730
00:37:18,400 --> 00:37:20,839
Speaker 1: I has had Tesla for ten years basically, and TESS

731
00:37:20,840 --> 00:37:23,160
Speaker 1: has contributed to two point seven percent or one percent

732
00:37:23,239 --> 00:37:27,040
Speaker 1: of its total return of two um. So you don't

733
00:37:27,040 --> 00:37:29,719
Speaker 1: have to worry about whether you know the new stock

734
00:37:29,840 --> 00:37:31,720
Speaker 1: is in it or not because it tracks small caps.

735
00:37:32,280 --> 00:37:34,479
Speaker 1: I also like the fact that it's regime change proof.

736
00:37:34,560 --> 00:37:36,600
Speaker 1: So we talked about small value. What a small value

737
00:37:36,640 --> 00:37:39,800
Speaker 1: has like a ten year run and the SNP lags,

738
00:37:40,200 --> 00:37:42,080
Speaker 1: it won't really matter too much with v t I.

739
00:37:42,160 --> 00:37:45,080
Speaker 1: You're gonna have those stocks in there anyway. Um. So

740
00:37:45,239 --> 00:37:48,200
Speaker 1: to me, vt I reminds me of that line in

741
00:37:48,239 --> 00:37:51,800
Speaker 1: the movie Almost Famous. Remember when the young journalist the

742
00:37:51,880 --> 00:37:54,680
Speaker 1: Rolling Stone Journalists talks to the sort of grizzled old

743
00:37:54,800 --> 00:37:58,080
Speaker 1: like rock critic played by Philip symour Hoffman and he says, yeah,

744
00:37:58,160 --> 00:37:59,680
Speaker 1: my kids are in the high school. Don't like me,

745
00:38:00,040 --> 00:38:01,879
Speaker 1: and he goes, don't worry, you'll you'll see them all

746
00:38:01,880 --> 00:38:04,400
Speaker 1: again in a long road to the middle. And I

747
00:38:04,560 --> 00:38:06,680
Speaker 1: just think v t I is the long road to

748
00:38:06,719 --> 00:38:10,560
Speaker 1: the middle. Whether it's value growth, small, large, these things

749
00:38:10,640 --> 00:38:12,720
Speaker 1: have their day and then they have they're in the doghouse.

750
00:38:12,840 --> 00:38:15,359
Speaker 1: V T I generally is gonna be where they all

751
00:38:15,480 --> 00:38:18,400
Speaker 1: end up, you know, over thirty forty years. So to me,

752
00:38:18,560 --> 00:38:20,520
Speaker 1: this is just like the sort of like the the

753
00:38:20,680 --> 00:38:23,600
Speaker 1: ultimate play on the market and something I'm watching next

754
00:38:23,719 --> 00:38:26,440
Speaker 1: year and every year after. James, what do you make

755
00:38:26,520 --> 00:38:30,520
Speaker 1: of that marijuana pick? So I I like I I

756
00:38:30,680 --> 00:38:33,439
Speaker 1: like ms os just because of basically what Eric said.

757
00:38:33,440 --> 00:38:36,560
Speaker 1: I mean, if if there's anything happening with US legalization,

758
00:38:36,560 --> 00:38:39,160
Speaker 1: whether it's federally or more states, those are the stocks

759
00:38:39,200 --> 00:38:41,600
Speaker 1: that are going to benefit the most. I actually did

760
00:38:41,719 --> 00:38:44,279
Speaker 1: some research on this and created like an index of

761
00:38:44,400 --> 00:38:47,160
Speaker 1: just ms like multi state operators, some that are included

762
00:38:47,160 --> 00:38:49,160
Speaker 1: in that ets, some that aren't. And I mean just

763
00:38:49,280 --> 00:38:51,719
Speaker 1: since March that thing, it's the market cap of all

764
00:38:51,760 --> 00:38:55,040
Speaker 1: those companies is up three hundred and thirty five So

765
00:38:55,160 --> 00:38:57,400
Speaker 1: we're talking like massive growth. A lot of that's on

766
00:38:57,440 --> 00:39:00,560
Speaker 1: the referendum from the election in November to states past

767
00:39:00,680 --> 00:39:04,239
Speaker 1: legalization in different matters. But if you're looking for legalization

768
00:39:04,280 --> 00:39:06,560
Speaker 1: in the US and you're buying MJ I mean it's

769
00:39:06,600 --> 00:39:09,040
Speaker 1: just too exposed to Canada to who truly benefit. And

770
00:39:09,120 --> 00:39:11,759
Speaker 1: one could argue that even legalization the US might even

771
00:39:11,800 --> 00:39:13,720
Speaker 1: be a bad thing for some of those Canadian companies,

772
00:39:13,760 --> 00:39:16,239
Speaker 1: which we saw some of those Canadian pot companies or

773
00:39:16,280 --> 00:39:21,399
Speaker 1: marijuana companies actually saw a negative impact. So definitely something

774
00:39:21,480 --> 00:39:24,320
Speaker 1: to be watching going forward, especially at the US political landscape.

775
00:39:24,480 --> 00:39:28,000
Speaker 1: And Morgan, what about what about ARC? Yeah? That was

776
00:39:28,040 --> 00:39:30,680
Speaker 1: like a no brainer, right, Yeah, pretty classic pick. But

777
00:39:30,960 --> 00:39:32,799
Speaker 1: I mean I think it would be crazy to say

778
00:39:32,800 --> 00:39:34,960
Speaker 1: we're not watching it next year. You know, I think

779
00:39:35,080 --> 00:39:40,640
Speaker 1: they they are high conviction shop and they are full transparencies.

780
00:39:40,680 --> 00:39:44,000
Speaker 1: We actually get to see what their high conviction choices

781
00:39:44,040 --> 00:39:47,440
Speaker 1: are here. But you know, they're trying to blend in

782
00:39:47,560 --> 00:39:51,560
Speaker 1: this fund. They're sort of including all their innovation platforms

783
00:39:51,800 --> 00:39:54,000
Speaker 1: um and so you really get a taste of kind

784
00:39:54,040 --> 00:39:57,759
Speaker 1: of full range here. So always interesting to watch and

785
00:39:57,800 --> 00:40:00,880
Speaker 1: see where their high conviction is. Sarah Vegas, what do

786
00:40:00,960 --> 00:40:03,080
Speaker 1: you make of the busses pick? Yeah, the d f

787
00:40:03,280 --> 00:40:06,600
Speaker 1: AU one is interesting. Well, I don't think the product

788
00:40:06,680 --> 00:40:10,480
Speaker 1: itself is that interesting. It's the it's d f A pick.

789
00:40:10,600 --> 00:40:14,880
Speaker 1: I like, um, you know, they launched these few ETFs,

790
00:40:14,960 --> 00:40:17,600
Speaker 1: then they did this massive conversion right behind it, so

791
00:40:17,680 --> 00:40:20,080
Speaker 1: they're coming into the industry with a bullet, they're now

792
00:40:20,120 --> 00:40:22,560
Speaker 1: going to be like the eleventh biggest issue where in

793
00:40:22,640 --> 00:40:26,200
Speaker 1: the market. So they came in very very aggressively. So

794
00:40:26,680 --> 00:40:28,600
Speaker 1: and what we've seen is firms that have done this,

795
00:40:29,080 --> 00:40:31,359
Speaker 1: the ones that really take it seriously and come come

796
00:40:31,400 --> 00:40:33,320
Speaker 1: in very aggressively are the ones that do tend to

797
00:40:33,400 --> 00:40:35,759
Speaker 1: do a little bit better. So, UM, that's that's a

798
00:40:35,800 --> 00:40:38,440
Speaker 1: really good pick. I think to judge how d f

799
00:40:38,520 --> 00:40:41,480
Speaker 1: A and frankly, how other active managers are going to follow.

800
00:40:42,200 --> 00:40:45,719
Speaker 1: Going back to ARC specifically, everyone likes to talk about ARC,

801
00:40:45,800 --> 00:40:48,600
Speaker 1: and Cathy would, but she has another product this year

802
00:40:48,640 --> 00:40:52,239
Speaker 1: that's beating ARC a r k K and everyone likes

803
00:40:52,280 --> 00:40:55,279
Speaker 1: to talk about ARC as a bubble bubble product. It's

804
00:40:55,280 --> 00:40:57,799
Speaker 1: getting all of its benett from Tesla, but air KG

805
00:40:57,960 --> 00:41:00,080
Speaker 1: doesn't hold Tesla's that you know, bout revolution et F,

806
00:41:00,480 --> 00:41:03,440
Speaker 1: which is another example of just how on fire Cathy

807
00:41:03,480 --> 00:41:06,080
Speaker 1: would has been. Um. The other thing is Tesla. It's

808
00:41:06,160 --> 00:41:08,440
Speaker 1: it's a big it's the largest contributor to a r

809
00:41:08,520 --> 00:41:11,840
Speaker 1: k K, but it's only contributed sevent of those returns

810
00:41:11,920 --> 00:41:14,280
Speaker 1: or since its inception, so it's not like it's solely

811
00:41:14,320 --> 00:41:16,040
Speaker 1: a test of fund. They're making a lot of other

812
00:41:16,160 --> 00:41:20,000
Speaker 1: high concentration bets, doing a lot of trading around their portfolio. Um,

813
00:41:20,120 --> 00:41:22,640
Speaker 1: that's generating alpha for them. So you hear a lot

814
00:41:22,719 --> 00:41:25,480
Speaker 1: of like financial media and Twitter talking about how bad

815
00:41:25,560 --> 00:41:27,320
Speaker 1: these products are, but when you dive in, it's not

816
00:41:27,520 --> 00:41:31,200
Speaker 1: really as um concentrated or solely due to one or

817
00:41:31,239 --> 00:41:32,960
Speaker 1: two stocks. It's a very They're getting a lot of

818
00:41:33,000 --> 00:41:36,640
Speaker 1: breath from their performance. Okay, hey, Eric, I want to

819
00:41:36,719 --> 00:41:39,799
Speaker 1: ask you at at Business Week, we do this thing

820
00:41:39,880 --> 00:41:42,680
Speaker 1: called the Jealousy List every year, which is we ask

821
00:41:43,080 --> 00:41:48,200
Speaker 1: a ton of the editors and writers, photo design, et cetera.

822
00:41:48,600 --> 00:41:51,960
Speaker 1: What was the one story that you were most jealous

823
00:41:52,080 --> 00:41:53,840
Speaker 1: of that we did not publish? And I want to

824
00:41:53,920 --> 00:41:57,319
Speaker 1: ask you, of all your team's picks, whose pick are

825
00:41:57,400 --> 00:41:59,840
Speaker 1: you most jealous of that wasn't your own. I'll go

826
00:42:00,040 --> 00:42:03,560
Speaker 1: with I c VT Morgan's pick. Um actually just forgot

827
00:42:03,600 --> 00:42:05,640
Speaker 1: it existed. I mean every other one that was picked

828
00:42:05,719 --> 00:42:09,600
Speaker 1: I pretty I mean at least I knew about um.

829
00:42:09,880 --> 00:42:11,520
Speaker 1: This is just one. You know, when it comes to

830
00:42:11,680 --> 00:42:14,200
Speaker 1: like prefers and convertibles and some of the stuff that's

831
00:42:14,200 --> 00:42:17,839
Speaker 1: sort of a little on the more wonky side, these

832
00:42:17,880 --> 00:42:20,320
Speaker 1: are ones that you sometimes forget about when you're constantly

833
00:42:20,360 --> 00:42:24,080
Speaker 1: looking at say the aggregate bond ETFs or uh, you know,

834
00:42:24,360 --> 00:42:27,359
Speaker 1: the high yield um and I like it, and it's

835
00:42:27,400 --> 00:42:29,320
Speaker 1: I looked at it's it's over a billion dollars, so

836
00:42:29,400 --> 00:42:31,680
Speaker 1: it's a you know, study t F. It's twenty BIPs

837
00:42:32,360 --> 00:42:34,360
Speaker 1: and yeah, I think it's great. And the returns were shocking.

838
00:42:34,480 --> 00:42:36,640
Speaker 1: If you had asked me how much this was up

839
00:42:36,680 --> 00:42:38,480
Speaker 1: this year, I would have been way off. So I

840
00:42:38,640 --> 00:42:41,440
Speaker 1: just like that. I was completely surprised by it. And

841
00:42:41,560 --> 00:42:43,840
Speaker 1: I honestly just you know, one of those ones you

842
00:42:43,920 --> 00:42:46,960
Speaker 1: just don't even realize is there, to be honest, which

843
00:42:47,000 --> 00:42:49,520
Speaker 1: at a billion dollars is probably not a good thing

844
00:42:49,600 --> 00:42:52,920
Speaker 1: to say about myself as an analyst. I mean, I

845
00:42:52,920 --> 00:42:54,759
Speaker 1: should probably have had that one in my mind, but

846
00:42:54,840 --> 00:42:57,920
Speaker 1: I just didn't. All Right, So I'm no math wizard,

847
00:42:57,960 --> 00:42:59,880
Speaker 1: but I do have a kindergardener that you know is

848
00:43:00,080 --> 00:43:02,560
Speaker 1: doing zoom kindergarten, and we're doing a lot of math together.

849
00:43:02,960 --> 00:43:05,080
Speaker 1: There's four of you. You each had five picks. That

850
00:43:05,200 --> 00:43:08,759
Speaker 1: brings us to twenty. How do we get to so? Um?

851
00:43:09,000 --> 00:43:11,279
Speaker 1: We were thinking about that and as we looked at

852
00:43:11,320 --> 00:43:14,719
Speaker 1: our list, two things. One we felt we had undersold

853
00:43:14,840 --> 00:43:17,120
Speaker 1: fixed income a little bit, but then too, one of

854
00:43:17,200 --> 00:43:20,520
Speaker 1: our big themes this year is in our outlook is

855
00:43:20,880 --> 00:43:23,440
Speaker 1: fixed income. So we decided to pick l q D

856
00:43:24,040 --> 00:43:27,239
Speaker 1: as one that we're watching next house. Pick Team, Pick,

857
00:43:27,400 --> 00:43:30,879
Speaker 1: Team Pick. This is the cherry on top of what's

858
00:43:30,920 --> 00:43:34,640
Speaker 1: already a large cake. Yeah, and what is it again?

859
00:43:34,960 --> 00:43:37,919
Speaker 1: It's it's a I shares investment gray bondy TF. It's

860
00:43:38,360 --> 00:43:40,520
Speaker 1: it's sort of become, as James put in his notes,

861
00:43:40,600 --> 00:43:44,400
Speaker 1: sort of the new bond dealer, as there's less inventory

862
00:43:44,560 --> 00:43:47,680
Speaker 1: at at traditional bond dealers. People use this thing all

863
00:43:47,680 --> 00:43:50,040
Speaker 1: the time for many different purposes, like a giant hotel

864
00:43:50,560 --> 00:43:52,120
Speaker 1: with all kinds of people coming in and out of it.

865
00:43:52,200 --> 00:43:57,520
Speaker 1: And this this mart sell off. Um. It's volume exploded um,

866
00:43:57,920 --> 00:44:01,480
Speaker 1: and people leaned on it and it worked. And then

867
00:44:01,520 --> 00:44:03,120
Speaker 1: the FED said they're going to buy E T f

868
00:44:03,200 --> 00:44:04,600
Speaker 1: S and the one they own the most of is

869
00:44:04,760 --> 00:44:07,719
Speaker 1: l q D. Was it was a wonderful endorsement for

870
00:44:07,880 --> 00:44:10,040
Speaker 1: E T S, I think and the assets and this

871
00:44:10,160 --> 00:44:13,000
Speaker 1: thing doubled from the March low of twenty eight billion,

872
00:44:13,040 --> 00:44:16,719
Speaker 1: they're now at fifty seven billion dollars. It's rare to

873
00:44:16,800 --> 00:44:19,160
Speaker 1: get a asset growth in an e t F that's

874
00:44:19,200 --> 00:44:22,520
Speaker 1: already massive, and so we're gonna see what happens next year.

875
00:44:22,560 --> 00:44:24,600
Speaker 1: This thing will be interesting. Will the Fed potentially look

876
00:44:24,640 --> 00:44:26,920
Speaker 1: to equity e t f s, Will they start unloading

877
00:44:26,960 --> 00:44:30,400
Speaker 1: their bond ETFs? Either way, we're very bullish fixed income.

878
00:44:30,719 --> 00:44:32,840
Speaker 1: This is one of those things where the Fed putting

879
00:44:32,880 --> 00:44:34,239
Speaker 1: its money behind. And one it was a lot of

880
00:44:34,280 --> 00:44:36,040
Speaker 1: people trying to front run, but also it's kind of

881
00:44:36,120 --> 00:44:38,880
Speaker 1: ended up like a snowball as more trading happens, as

882
00:44:38,920 --> 00:44:40,759
Speaker 1: more money comes into it, more and more people are

883
00:44:40,800 --> 00:44:42,959
Speaker 1: going to start using it kind of as a bond

884
00:44:43,000 --> 00:44:45,480
Speaker 1: dealer as you mentioned, and the other it's just becomes

885
00:44:45,520 --> 00:44:47,960
Speaker 1: more liquid and more institutional attention, and that all of

886
00:44:48,040 --> 00:44:51,640
Speaker 1: that kind of snowballs onto each other. UM. So this

887
00:44:51,760 --> 00:44:53,720
Speaker 1: is something we're watching to see how long that snowball

888
00:44:53,760 --> 00:44:58,479
Speaker 1: can go on, um and will it continue. James Morgan, Tom,

889
00:44:58,880 --> 00:45:02,040
Speaker 1: thank you so much for joining us on Trillions. Thank you,

890
00:45:02,360 --> 00:45:10,000
Speaker 1: thanks for having us, Thanks for listening to Trillions until

891
00:45:10,080 --> 00:45:12,160
Speaker 1: next time. You can find us on the Bloomberg terminal,

892
00:45:12,400 --> 00:45:16,759
Speaker 1: Bloomberg dot com, Apple Podcasts, Spotify, and where else you'd

893
00:45:16,760 --> 00:45:19,000
Speaker 1: like to listen. We'd love to hear from you. We're

894
00:45:19,040 --> 00:45:22,920
Speaker 1: on Twitter. I'm at Joel Webber Show. He's at Eric Falcinos.

895
00:45:23,320 --> 00:45:27,040
Speaker 1: You can find Morgan at M Barnes six, James at

896
00:45:27,239 --> 00:45:31,920
Speaker 1: J SEF, and Athanacios at Ta Sara Phagas. As always,

897
00:45:31,960 --> 00:45:34,520
Speaker 1: good luck spelling that one. This episode of Trillions was

898
00:45:34,560 --> 00:45:37,719
Speaker 1: produced by Magnus Hendrickson. Francesca Levie is the head of

899
00:45:37,760 --> 00:45:39,520
Speaker 1: Bloomberg Podcast. Bye.