WEBVTT - Day One, Part Two at Schwab Impact in San Francisco 0:00:02.560 --> 0:00:06.920 Bloomberg Audio Studios, podcasts, radio news. 0:00:07.160 --> 0:00:10.480 You're listening to Bloomberg Business Week with Carol Messer and 0:00:10.560 --> 0:00:12.960 Tim Stenebek on Bloomberg Radio. 0:00:13.119 --> 0:00:14.480 All right, let's get to Dana Dioria. 0:00:14.520 --> 0:00:17.040 It's so sweet to have her actually here on site 0:00:17.079 --> 0:00:19.480 with us. We're often talking to her remotely. Dana is 0:00:19.520 --> 0:00:23.000 co chief investment Officer at Investment. They provide technology and 0:00:23.040 --> 0:00:25.280 services to the wealth and asset management. They've got more 0:00:25.320 --> 0:00:28.640 than five point eight trillion dollars in platform assets, more 0:00:28.640 --> 0:00:31.240 than one hundred and eight thousand advisors, sixteen of the 0:00:31.280 --> 0:00:34.519 twenty largest US banks, forty eight of the fifty largest 0:00:34.520 --> 0:00:36.760 wealth management and brokerage firms, more than five hundred of 0:00:36.800 --> 0:00:40.360 the largest RAS, thousands of companies as clients. She's all in, 0:00:40.560 --> 0:00:42.640 and I got to say their platform sees a lot. 0:00:42.479 --> 0:00:44.159 Tim, Dana Dioria, good to see you. 0:00:44.240 --> 0:00:45.600 Welcome, Welcome to you. 0:00:45.920 --> 0:00:49.480 Usually usually we see you in a little screen on yeah, 0:00:49.560 --> 0:00:52.080 exactly in our studio black, So it's good to see 0:00:52.120 --> 0:00:55.200 you here in person. What's the tone that you're taking 0:00:55.240 --> 0:00:57.960 away here in this first day at Schwab. 0:00:57.720 --> 0:00:59.560 Impact, Well, I think, and it's awesome to have you 0:00:59.600 --> 0:01:02.120 here with the in our in our ecosystem, so to speak, 0:01:02.200 --> 0:01:06.200 right the retail advisor. Yeah, look, it's it's all energy, right, 0:01:06.360 --> 0:01:09.720 It's a lot of excitement, you know. The I've always 0:01:09.720 --> 0:01:12.600 said and I often say that asset management and tech 0:01:12.640 --> 0:01:15.400 are sort of blurring the lines a lot. And as 0:01:15.480 --> 0:01:18.520 tech gets better and better at bringing solutions to the 0:01:18.560 --> 0:01:20.560 advisory base, and we're just seeing that in these hype 0:01:20.600 --> 0:01:23.440 conferences and impact is you know, just huge in our space. 0:01:23.480 --> 0:01:24.680 Tell us about flows and stuff. 0:01:24.680 --> 0:01:26.560 And I also think if you've seen anything different or 0:01:26.600 --> 0:01:29.680 what you're hearing from your client base post elections, right, Uh, 0:01:29.800 --> 0:01:31.600 you know, one one element of. 0:01:31.560 --> 0:01:32.840 What is it going to be? How's it going to 0:01:32.880 --> 0:01:33.240 play out? 0:01:33.280 --> 0:01:34.760 Is off the table, and then there's a new set 0:01:34.760 --> 0:01:36.120 in terms of the policies to come. 0:01:36.240 --> 0:01:37.960 Yeah, for sure. I mean, of course there was the 0:01:37.959 --> 0:01:40.640 Trump trade, and you know, if you happen to get 0:01:40.800 --> 0:01:42.440 or you I won't say, happen if you if you 0:01:42.520 --> 0:01:45.360 made that bet and you know, uh, pharma and fossil 0:01:45.360 --> 0:01:48.040 fuels and financials and we're gonna have lower like regulation 0:01:48.080 --> 0:01:51.240 and everything. I mean certainly you made a buck, right 0:01:51.360 --> 0:01:53.240 if you if you went for that trade. 0:01:53.600 --> 0:01:55.520 I think crypto crypto boom. 0:01:55.360 --> 0:01:57.480 Right, when you say pharma, do you mean shorting pharma 0:01:57.640 --> 0:01:58.400 or no, you mean. 0:01:58.320 --> 0:02:00.760 Big just lower regulations right the whole. 0:02:00.840 --> 0:02:03.760 Like Ideak's in charge, he might get a little angry. 0:02:03.520 --> 0:02:05.880 With pharma, right, I mean there's new. 0:02:06.280 --> 0:02:08.120 We saw farming companies fall when his when he was 0:02:08.160 --> 0:02:10.640 his name was announced. 0:02:10.160 --> 0:02:13.240 And there's new and every day, right, new information, especially 0:02:13.240 --> 0:02:15.320 now that we're getting all the cabinet picks. I think, 0:02:15.440 --> 0:02:18.040 you know, I draw the line between what was happening 0:02:18.080 --> 0:02:20.360 prior to the election and what people were kind of 0:02:20.440 --> 0:02:23.520 obviously taking that bet. And you know, the market price 0:02:23.560 --> 0:02:27.120 can only reflect probabilities plus you know the outcome and 0:02:27.120 --> 0:02:29.320 and some and it's one number to reflect all of that. 0:02:29.680 --> 0:02:32.600 So yeah, probably if you if you made these bets 0:02:32.600 --> 0:02:35.000 ahead of time, you made that buck. Uh. Now where 0:02:35.000 --> 0:02:37.240 you stand is how well is the market pricing in 0:02:37.560 --> 0:02:39.840 exactly that kind of information that you're talking about. Not 0:02:40.080 --> 0:02:43.440 just do I think that you know this administration will 0:02:43.440 --> 0:02:45.440 be good for pharma? Do I think this administration will 0:02:45.480 --> 0:02:47.280 be good for fossil fuels? But how well is the 0:02:47.280 --> 0:02:50.040 market pricing in that likelihood? And can I you know, 0:02:50.160 --> 0:02:51.080 hang on for the ride. 0:02:51.120 --> 0:02:54.040 It's so interesting Tim brought this up our Matt Miller, 0:02:54.960 --> 0:02:59.480 and we're anchoring just before us and just saying how 0:02:59.560 --> 0:03:02.040 and Vidio is like the most important thing, even more 0:03:02.040 --> 0:03:03.560 than what like the Fed's going to do next. 0:03:04.520 --> 0:03:07.480 Having said that, what the FED does next. 0:03:07.320 --> 0:03:10.520 Is important, and I think what we think today may 0:03:10.520 --> 0:03:12.280 not be exactly what we're going to be thinking a 0:03:12.320 --> 0:03:14.800 week before the FED meeting. So how are you thinking 0:03:14.840 --> 0:03:16.239 about FED policy right now? 0:03:16.600 --> 0:03:19.440 You know, I'll tell you I have aired on the 0:03:19.520 --> 0:03:22.200 side of they're going to need to be cautious about 0:03:22.240 --> 0:03:24.280 these rate cuts. In fact, they didn't really expect that 0:03:24.320 --> 0:03:26.440 fifty basis point right, And you know, I think it 0:03:26.440 --> 0:03:28.920 was pre election and they decided to do it. I 0:03:28.919 --> 0:03:31.120 think they thought they were behind in July. But when 0:03:31.160 --> 0:03:34.080 you see inflation kind of sticking and you understand that, 0:03:34.240 --> 0:03:37.480 you know, tariffs could potentially be inflationary, you know, we 0:03:37.560 --> 0:03:39.440 may be looking at an administration that wants to run 0:03:39.440 --> 0:03:42.560 the economy a bit hot. They're looking at fiscal policy 0:03:42.760 --> 0:03:45.760 and you know, monetary policy that maybe has to counteract 0:03:45.760 --> 0:03:47.920 some of that. So when you put that together, I 0:03:48.080 --> 0:03:50.920 just don't think we can expect the big tailwind from 0:03:50.960 --> 0:03:52.480 interest rate cuts in the coming year. 0:03:52.960 --> 0:03:55.200 Interesting Wall nothing December. 0:03:56.360 --> 0:03:58.760 I think December is definitely on the table, and the 0:03:58.800 --> 0:04:02.080 base case is yes. But I also don't think it's 0:04:02.080 --> 0:04:03.880 out of the realm of possibility that they don't do 0:04:03.960 --> 0:04:06.120 it in December, depending on the data that comes out 0:04:06.160 --> 0:04:06.840 between now and then. 0:04:06.880 --> 0:04:09.240 So does that mean a higher terminal rate? Does that 0:04:09.320 --> 0:04:12.040 mean that the new sort of normal stance of monetary 0:04:12.080 --> 0:04:13.880 policy is high forever? 0:04:14.720 --> 0:04:17.560 I think higher for longer, and we're back to this 0:04:17.720 --> 0:04:18.560 terminology right. 0:04:18.839 --> 0:04:20.320 Think about what think about the round trip we did 0:04:20.320 --> 0:04:22.480 a year ago, Carol, we were sitting here after j. 0:04:22.600 --> 0:04:25.039 Powell gives a press conference, I'd say eleven months ago, 0:04:25.400 --> 0:04:27.760 basically like, oh, we'll see you know, six seven rate 0:04:27.800 --> 0:04:31.080 cuts in twenty twenty four that obviously did not happen. 0:04:31.080 --> 0:04:33.720 Now the question is, okay, well, is the terminal rate 0:04:33.800 --> 0:04:35.240 something higher than we thought it would be. 0:04:35.600 --> 0:04:38.760 I think the market has overshot the expectation of rate cuts. 0:04:38.760 --> 0:04:40.440 You just said it, right, just going back to what 0:04:40.480 --> 0:04:43.160 we saw. You know, of course, where did we begin 0:04:43.240 --> 0:04:45.679 this year right with this huge expectation of rate cuts 0:04:45.680 --> 0:04:47.719 and that was just that never made any sense depending 0:04:47.760 --> 0:04:50.080 on you know, what the economy was doing. Anyway, I 0:04:50.120 --> 0:04:53.440 think we've overshot I think the end point. It depends 0:04:53.480 --> 0:04:55.600 on where you call this end point. Yes, I think 0:04:55.640 --> 0:04:58.160 it could be a little bit higher than what is anticipated, 0:04:58.320 --> 0:05:02.000 But I also think the slowness of the cuts and 0:05:02.040 --> 0:05:05.200 the market you know, pricing that in and and you 0:05:05.200 --> 0:05:07.599 know there there's a there's a little bit of a 0:05:07.600 --> 0:05:10.240 case here to just stop the rate cuts all together. 0:05:09.960 --> 0:05:13.520 For now is amazing. You guys shared your your team 0:05:13.560 --> 0:05:14.240 shared of. 0:05:14.160 --> 0:05:16.160 Some notes from you and said knowing what a candidate 0:05:16.200 --> 0:05:18.640 favors also doesn't do much for figuring out what will 0:05:18.640 --> 0:05:20.560 prevail over the course of the presidency from a stock 0:05:20.560 --> 0:05:24.000 return perspective. For example, cold stocks have excelled under Biden, 0:05:24.360 --> 0:05:26.880 while clean energy shares are performed under Trump. And you say, 0:05:26.960 --> 0:05:28.440 that's our data, Bloomberg data. 0:05:28.600 --> 0:05:30.200 Yeah, so it's. 0:05:30.200 --> 0:05:33.599 Right, Like it's just it just reminds us there's so 0:05:33.720 --> 0:05:36.320 much that we know that we don't know. 0:05:37.000 --> 0:05:40.359 It's numerator and denominator, right, you know, it's what's going 0:05:40.440 --> 0:05:43.240 to be good for the revenue of these companies, but 0:05:43.320 --> 0:05:47.039 also how much the market has discounted that capability and 0:05:47.080 --> 0:05:49.680 if and if there's too much of a discount, you know, 0:05:50.040 --> 0:05:53.599 then it can't meet that And that goes right into Nvidia. 0:05:53.720 --> 0:05:56.159 Is it price to perfection or is it you know, 0:05:56.520 --> 0:05:58.120 way past the price of perfection. 0:05:58.240 --> 0:05:59.279 So talk to us about Nvidia. 0:05:59.320 --> 0:06:01.760 It's our focus now and understandably, in about thirteen minutes 0:06:01.800 --> 0:06:04.200 we're going to be breaking down those results. We were 0:06:04.200 --> 0:06:07.800 saying that options trading right now signals that the results 0:06:07.839 --> 0:06:11.719 will be the most significant important catalyst. 0:06:11.480 --> 0:06:14.600 Left this this year. How are you thinking about it? 0:06:14.640 --> 0:06:17.240 What you might be ultimately hearing from clients and investors later, 0:06:17.279 --> 0:06:18.680 I don't know tie it up for us. 0:06:18.720 --> 0:06:21.279 The way that we think about it is when we 0:06:21.320 --> 0:06:23.680 look at portfolios and just we look at the research 0:06:23.720 --> 0:06:26.440 too around just what it's done to portfolios, the intense 0:06:26.480 --> 0:06:29.960 concentration in these indexes, these big big names like in Vidia, 0:06:30.279 --> 0:06:33.720 and so much of investor portfolios are actually sitting on 0:06:33.760 --> 0:06:36.120 these outcomes, and I don't think a lot of investors 0:06:36.160 --> 0:06:39.119 understand that, right. So if you say, okay, in Vidia 0:06:39.240 --> 0:06:43.240 beat beat beat expectations and it does phenomenally, well, you 0:06:43.279 --> 0:06:44.240 know that's fantastic. 0:06:44.640 --> 0:06:46.159 If even if in videos, I. 0:06:46.160 --> 0:06:48.279 Think we all know in Vidia's got a very good 0:06:48.320 --> 0:06:51.200 product that is going to drive for a long period 0:06:51.240 --> 0:06:52.440 of time, I'm still buying growth. 0:06:52.560 --> 0:06:54.520 Yeah, right, So what. 0:06:54.560 --> 0:06:57.839 Happens in this moment is that is not super important 0:06:57.839 --> 0:07:00.000 for the for the course of what happens with AI 0:07:00.120 --> 0:07:02.200 over the course of the year. But we are living 0:07:02.240 --> 0:07:04.719 in a period of concentration where it is super important 0:07:04.760 --> 0:07:05.920 for our client portfolios. 0:07:06.240 --> 0:07:08.840 People want to know right, they care, they care. There 0:07:08.839 --> 0:07:11.040 are just certain things that are like guiding lights. Dana, 0:07:11.160 --> 0:07:12.440 so great to catch up with you again. 0:07:12.520 --> 0:07:13.440 Thank you for having me. 0:07:13.600 --> 0:07:14.200 Yeah, thank you. 0:07:14.560 --> 0:07:18.240 Danna Dioria, co Chief investment Officer Evia Vestnet joining us 0:07:18.320 --> 0:07:19.600 right here at Schwab Impact. 0:07:19.680 --> 0:07:21.760 We're going to talk a little bit about ETFs right now. 0:07:21.960 --> 0:07:24.840 A new record ninety six percent of ETFs have posted 0:07:25.080 --> 0:07:27.520 positive returns of the past year. The majority of products 0:07:27.560 --> 0:07:31.040 headed for double digit wins. Our Bloomberg intelligence team did 0:07:31.080 --> 0:07:33.600 some analysis and this is what they found out and 0:07:33.680 --> 0:07:36.400 tim the average US domiciled ETF up fourteen percent of 0:07:36.480 --> 0:07:39.600 the past twelve months. Everybody's all in, Yeah they are. 0:07:40.680 --> 0:07:43.960 It's like it's like the normal thing. Are ETFs now? 0:07:44.000 --> 0:07:46.239 I mean, get this, Schwab started in the ETF business 0:07:46.280 --> 0:07:48.240 fifteen years ago. It's one of the dominant players. They 0:07:48.240 --> 0:07:52.000 got thirty one ETFs, including ten fixed income offerings, making 0:07:52.000 --> 0:07:54.880 it the fifth largest provider of ETFs with more. Let's 0:07:54.880 --> 0:07:57.440 bring in David botset Managing director, head of Innovation in 0:07:57.480 --> 0:08:00.440 Stewardship at Schwab here on site in Sanford, Cisco. 0:08:00.640 --> 0:08:03.040 Hello, good to see you. Good to see you. It's 0:08:03.080 --> 0:08:05.720 been since last year since we talked an impact in Philadelphia. 0:08:05.760 --> 0:08:07.640 Nothing's gone on in the past year, nothing at all. 0:08:08.120 --> 0:08:10.520 Well, it's funny you think about innovation in the space, 0:08:10.560 --> 0:08:12.200 and we've seen some big innovations this year when it 0:08:12.200 --> 0:08:15.560 comes to crypto ETF specifically bitcoin and ether ETFs. How 0:08:15.600 --> 0:08:17.640 do you think about innovation when it comes to ETFs. 0:08:17.680 --> 0:08:19.400 You know, the first thing we start with is what 0:08:19.440 --> 0:08:21.600 are the investor needs? You know, that's at the heart 0:08:21.640 --> 0:08:23.760 and the ethos of everything we've been doing in ETF 0:08:23.840 --> 0:08:25.760 so the past fifteen years you mentioned, and that's really 0:08:25.760 --> 0:08:28.080 helped compel stuff up to four hundred billion dollars in 0:08:28.120 --> 0:08:30.840 assets in our ETFs. So we've been doing an annual 0:08:30.880 --> 0:08:34.320 ETF investor study now for over a decade that's asking 0:08:34.440 --> 0:08:38.440 questions of both ETF investors and non ETF investors about 0:08:38.840 --> 0:08:42.000 their various views on how do they think about ETFs, 0:08:42.040 --> 0:08:44.600 what's most important to them about what they're investing in 0:08:44.880 --> 0:08:47.560 and what categories they may invest in the future. That 0:08:47.679 --> 0:08:50.400 provides us a lot of great insights to help drive 0:08:50.440 --> 0:08:51.680 our innovation in the space. 0:08:52.000 --> 0:08:56.480 All Right, So for non ETF investors versus ETF investors, 0:08:56.520 --> 0:08:57.640 what they want is it different? 0:08:58.160 --> 0:09:01.080 You know, there are some nuances to them. So in 0:09:01.120 --> 0:09:03.960 some cases it's very much the same. It's things that 0:09:04.000 --> 0:09:07.240 they're looking at when they're selecting an ETF, like cost right, 0:09:07.320 --> 0:09:10.120 that stands out in both categories. But there are other 0:09:10.160 --> 0:09:13.680 areas where we see non ETF investors they need more education, 0:09:13.800 --> 0:09:17.000 they need more insights because their confidence level in selecting 0:09:17.000 --> 0:09:20.640 an ETF is much less than those that are ETF investors. 0:09:20.760 --> 0:09:21.640 Makes sense, it does. 0:09:21.800 --> 0:09:24.319 Hey, listen, one thing that they need is a mortgage 0:09:24.360 --> 0:09:28.199 backed security ETF, which just you guys launched this week 0:09:28.559 --> 0:09:29.600 one day ago yesterday. 0:09:29.720 --> 0:09:32.439 Yes, it was so tell us about that. You know what, 0:09:33.000 --> 0:09:35.640 We listen to our investor base. The one thing that 0:09:35.640 --> 0:09:38.360 they tell us is we need more precise tools for 0:09:38.400 --> 0:09:40.520 our fixed income allocation. You know, we go back a 0:09:40.600 --> 0:09:43.840 decade and everybody was using the aggregate index to get 0:09:43.880 --> 0:09:46.840 their fixed income exposure. But in a dynamic interest rate 0:09:46.960 --> 0:09:49.240 environment like we're in today, they want to control for 0:09:49.679 --> 0:09:53.320 sector exposure, they want to control for duration, they want 0:09:53.360 --> 0:09:57.120 to control for the credit quality and their portfolio. Mortgage 0:09:57.120 --> 0:09:59.559 backed securities is one of those that frequently are under 0:10:00.320 --> 0:10:03.280 utilized in a portfolio, but they think about how do 0:10:03.320 --> 0:10:08.040 I redynamicize that aggregate exposure. They want that precision in 0:10:08.760 --> 0:10:09.760 an MBS ETF. 0:10:09.920 --> 0:10:11.920 Are you thinking about getting into what our own Eric 0:10:11.960 --> 0:10:15.960 Beltunas over at Bloomer Intelligence calls the hot sauce ETFs. Like, 0:10:16.559 --> 0:10:19.040 if you've got ninety five percent of your portfolio, you know, 0:10:19.160 --> 0:10:22.439 in large cap stocks and maybe some bond funds, you 0:10:22.520 --> 0:10:25.040 got five percent to play with, Maybe you throw some 0:10:25.120 --> 0:10:28.960 into ARC or you throw some into Bitcoin ETF. Are 0:10:29.000 --> 0:10:31.840 you guys thinking about getting into that sort of specialty category? 0:10:31.880 --> 0:10:33.720 Maybe go leveraged in Vidia ETF. 0:10:34.480 --> 0:10:37.160 You know, our bread and butter largely is in the 0:10:37.160 --> 0:10:42.640 core analyst Eric's a great guy. I'd love to work 0:10:42.679 --> 0:10:44.320 with them, but you know, our bread and butter is 0:10:44.360 --> 0:10:47.680 really in the core products and solutions, right because where 0:10:47.720 --> 0:10:50.120 we see the benefit that we can provide as an 0:10:50.120 --> 0:10:53.320 ETF provider is on cost, which is number one in 0:10:53.360 --> 0:10:56.559 our survey year and year again, Cost number one thing 0:10:56.640 --> 0:10:57.240 people look. 0:10:57.080 --> 0:10:59.280 At so there's a race to the bottom with those 0:10:59.400 --> 0:11:02.600 sort of big broad ETF because there is so much competition. 0:11:02.679 --> 0:11:03.960 And that's why I think you see a lot of 0:11:03.960 --> 0:11:06.200 innovation happening in the Okay, well, how can we make 0:11:06.240 --> 0:11:09.480 our product unique and also charge fifty basis points instead 0:11:09.480 --> 0:11:10.800 of eight basis points? 0:11:10.840 --> 0:11:13.120 Yes, well, I think you'll see us innovating in that 0:11:13.160 --> 0:11:16.319 space is less on those hot sauce areas, and it's 0:11:16.360 --> 0:11:18.800 more thinking about how do we use the ETF wrapper 0:11:18.840 --> 0:11:22.400 in other ways bring actively managed strategies. Earlier this year 0:11:22.440 --> 0:11:25.880 we launched the Schwab Alter Short Income ETF. You know, 0:11:25.880 --> 0:11:28.640 you look at that alter short space, it's really hard 0:11:28.640 --> 0:11:31.600 to index that category. We also think it's an area 0:11:31.640 --> 0:11:34.240 where an active manager can potentially provide alpha. 0:11:34.400 --> 0:11:36.000 Is it all about active going forward? 0:11:36.160 --> 0:11:38.440 You know, I don't think it's all about active, Yeah, 0:11:38.480 --> 0:11:41.280 but increasingly you're seeing that in that space that's either 0:11:41.320 --> 0:11:44.640 coming through new launches or conversions of active mutual funds 0:11:44.640 --> 0:11:47.280 and ETFs there, and they're taking an outsized portion of 0:11:47.520 --> 0:11:48.240 the flows this year. 0:11:48.320 --> 0:11:50.360 I always think about this, David. I began kind of 0:11:50.360 --> 0:11:51.760 my career in business news. 0:11:51.800 --> 0:11:53.800 You had a show, an ETF show, right or mutual. 0:11:53.520 --> 0:11:57.120 Fund Mutual fun show not so long ago, and it's 0:11:57.200 --> 0:11:59.800 just interesting to see the arc and how we move 0:11:59.840 --> 0:12:01.720 to When is it that we just don't have mutual 0:12:01.720 --> 0:12:02.920 funds and it's all about ETFs? 0:12:02.960 --> 0:12:03.960 Is it just a matter of time? 0:12:04.240 --> 0:12:08.559 I don't think so that continue. Well, I think it's 0:12:08.640 --> 0:12:12.040 all about the benefits the ETF provides. It can provide 0:12:12.080 --> 0:12:15.120 a cost benefit, It can provide a tax benefit because 0:12:15.120 --> 0:12:18.040 they tend to be more tax efficient, and a trading benefit. 0:12:18.240 --> 0:12:21.600 But in many accounts where it's a qualified account, you're 0:12:21.640 --> 0:12:24.400 not paying taxes, that tax benefit isn't there. You also 0:12:24.400 --> 0:12:28.120 see a lot of strategic allocation long longer term investors 0:12:28.520 --> 0:12:31.480 for one K plans, retirement plans where you may not 0:12:31.640 --> 0:12:35.520 necessarily need that tax benefit or the ability to trade 0:12:35.559 --> 0:12:37.360 every day in your allocation. If I'm more of a 0:12:37.400 --> 0:12:38.760 strategic investor. 0:12:38.360 --> 0:12:40.600 Are investors though, who are planning for the retirement missing 0:12:40.679 --> 0:12:44.080 alpha though by doing mutual funds that way? 0:12:44.160 --> 0:12:46.000 Like, I mean, are they missing out on opportunities? 0:12:46.040 --> 0:12:49.880 Pretend? I think potentially and increasingly they may miss out 0:12:49.880 --> 0:12:51.840 on those opportunities because the innovation is going to be 0:12:51.840 --> 0:12:54.400 more in the ETFs than it is in mutual funds. 0:12:54.480 --> 0:12:57.040 So in those new opportunities that arise, what. 0:12:57.040 --> 0:12:59.840 About money market ets versus money market mutual funds? 0:13:00.440 --> 0:13:03.000 You know, it's interesting. We're seeing some work by other 0:13:03.120 --> 0:13:05.440 firms in that space. It'll be interesting to see. 0:13:05.559 --> 0:13:06.800 But right now, if I want to buy a money 0:13:06.800 --> 0:13:08.360 market fund at Charles Shraub, I have to buy a 0:13:08.440 --> 0:13:09.000 mutual fund. 0:13:09.280 --> 0:13:11.160 It isn't a fund structure, that's right. 0:13:11.360 --> 0:13:11.760 Why is that? 0:13:12.240 --> 0:13:14.840 Well? I mean, I think the people like the dollar 0:13:15.000 --> 0:13:17.560 nav right, That's one of the big distinctions where we've 0:13:17.600 --> 0:13:19.880 seen that the one product that is in the market today. 0:13:20.360 --> 0:13:22.760 You're no longer trading at a dollar like you do 0:13:22.920 --> 0:13:25.840 with a money market fund. It's dollar in, dollar out. 0:13:25.880 --> 0:13:28.480 You like that known factor, and I'm not sure that 0:13:28.760 --> 0:13:31.160 investors will necessarily want to stray for that when they 0:13:31.200 --> 0:13:32.640 think about their cash investments. 0:13:32.840 --> 0:13:35.480 How does the macro play into the ETFs that you 0:13:35.520 --> 0:13:37.760 guys are thinking about in terms of launches. 0:13:37.440 --> 0:13:39.520 You know, for us, it's really about the long term view. 0:13:39.559 --> 0:13:42.520 It's less about a macro current point in time. It's 0:13:42.559 --> 0:13:45.199 really thinking about how do we serve investors' needs for 0:13:45.240 --> 0:13:45.840 the long haul. 0:13:46.040 --> 0:13:48.920 So even like you know, a new administration, new policies 0:13:48.920 --> 0:13:51.960 that might impact the economy and various sectors. 0:13:52.040 --> 0:13:52.960 It's not the way you play it. 0:13:52.960 --> 0:13:53.960 It's not the way we play it. 0:13:53.960 --> 0:13:58.240 That's right, all right? Interesting does the macro view though? 0:13:58.400 --> 0:14:00.120 I mean, as you look at what's going on in 0:14:00.120 --> 0:14:02.640 the space, how does it impact at all your thinking? 0:14:02.800 --> 0:14:05.080 Yeah? So I think where it impacts our thinking is 0:14:05.360 --> 0:14:08.960 when we talk to investors about how to allocate their portfolios. Okay, right, 0:14:09.040 --> 0:14:10.960 you think about our do they have lots of questions 0:14:11.000 --> 0:14:12.439 right now? Absolutely? 0:14:12.840 --> 0:14:15.200 Let's say you were to just think about the universe 0:14:15.240 --> 0:14:18.439 of ETFs in your world. How much of those ETFs 0:14:18.480 --> 0:14:21.200 are when the money comes in? Is it about indexing 0:14:21.800 --> 0:14:25.440 versus about something outside of indexing to try to get alpha? 0:14:25.520 --> 0:14:28.680 You know, I think it's the way that indexing is used, 0:14:29.160 --> 0:14:32.600 right model portfolio strategic allocations. It's more about how do 0:14:32.680 --> 0:14:36.400 I tilt between large cap and small cap, domestic international 0:14:36.480 --> 0:14:39.560 looking for those alpha opportunities rather than within the asset 0:14:39.560 --> 0:14:40.280 class itself. 0:14:40.560 --> 0:14:43.720 We mentioned you guys fifteen years just celebrate your anniversary 0:14:43.760 --> 0:14:45.720 from your first ETF. How do you think about the 0:14:45.760 --> 0:14:48.600 trajectory and kind of where the ETF market was at 0:14:48.640 --> 0:14:51.120 the beginning. I remember a time I felt like every 0:14:51.280 --> 0:14:54.080 guest or every other guest with somebody offering up a 0:14:54.080 --> 0:14:57.440 new ETF. I feel like it's founded a different groove 0:14:57.600 --> 0:14:59.160 now and it's matured. 0:14:59.200 --> 0:15:01.000 But tell us about you've been in it. 0:15:01.160 --> 0:15:04.440 Yeah, I've been in the ETF industry for nearly twenty years, 0:15:04.440 --> 0:15:07.280 so it's it's been a long time. It's been a 0:15:07.320 --> 0:15:10.000 great run. But we've still got a lot of innovation 0:15:10.160 --> 0:15:12.320 to go. So I think we're just in the early 0:15:12.400 --> 0:15:15.240 inning still of what the ATF can bring to investors 0:15:15.320 --> 0:15:16.680 and video ATF is it coming. 0:15:16.560 --> 0:15:20.560 Anytimes they have? I think direction, Yes, the direction. 0:15:20.800 --> 0:15:23.760 There are some single stock levered ETFs in the market. 0:15:23.920 --> 0:15:25.400 That's what I was thinking of when I was referring 0:15:25.440 --> 0:15:28.560 to that leveraged You were channeling your inner Eric. 0:15:28.920 --> 0:15:31.920 Yeah, David, thank you so much. Fun to check in 0:15:31.960 --> 0:15:32.400 with you again. 0:15:32.520 --> 0:15:33.040 Thanks so much. 0:15:33.080 --> 0:15:34.800 I hope Eric is listening and knows that I'm giving 0:15:34.840 --> 0:15:35.520 him all this love. 0:15:35.640 --> 0:15:37.760 He better I'll point it out to come on air.