1 00:00:05,880 --> 00:00:06,560 Speaker 1: Welcome and Trallians. 2 00:00:06,600 --> 00:00:08,879 Speaker 2: I'm Joe Webber and I'm Eric Valcunas. 3 00:00:11,720 --> 00:00:11,880 Speaker 3: Eric. 4 00:00:11,920 --> 00:00:16,400 Speaker 1: For the third time, we're having Perth Toll on the podcast. 5 00:00:17,000 --> 00:00:20,280 Speaker 1: She's the founder of the Life and Liberty Indexes and 6 00:00:20,320 --> 00:00:24,040 Speaker 1: specifically the Freedom one hundred Emerging Markets ETF. She was 7 00:00:24,040 --> 00:00:27,120 Speaker 1: on the first time in twenty nineteen when the ETF 8 00:00:27,200 --> 00:00:29,760 Speaker 1: was new, and she came back in twenty twenty two 9 00:00:29,880 --> 00:00:32,600 Speaker 1: to do a debate with Jeremy Schwartz Wisdom Try about 10 00:00:32,600 --> 00:00:36,800 Speaker 1: emerging markets. And since either of those appearances she has 11 00:00:36,880 --> 00:00:42,080 Speaker 1: been crushing it. Her ticker FRDM has been absolutely crushing it. 12 00:00:42,400 --> 00:00:45,920 Speaker 1: What do you want to know about this ETF now 13 00:00:46,360 --> 00:00:47,320 Speaker 1: that you didn't know before? 14 00:00:47,760 --> 00:00:50,040 Speaker 4: Perth has been interesting to me because a it's indy. 15 00:00:50,360 --> 00:00:53,280 Speaker 4: I like indie stories. She lived it. You know, a 16 00:00:53,280 --> 00:00:55,920 Speaker 4: lot of this is about, you know, eliminating countries that 17 00:00:55,960 --> 00:00:58,960 Speaker 4: are not free and buying the ones that are more free. 18 00:00:59,520 --> 00:01:03,360 Speaker 4: And her experience as a young person in China affected 19 00:01:03,400 --> 00:01:06,360 Speaker 4: all this. So the story is really great and the 20 00:01:06,400 --> 00:01:08,640 Speaker 4: indie it's hard to get assets as an indie. You 21 00:01:08,720 --> 00:01:11,160 Speaker 4: kind of need a shiny object moment, as we say 22 00:01:11,200 --> 00:01:15,200 Speaker 4: all the time. Well, FRDM has got that moment right now. 23 00:01:15,240 --> 00:01:17,640 Speaker 4: I mean I was on a podcast with Dave Nady 24 00:01:17,680 --> 00:01:19,720 Speaker 4: called etf Zoo, which is pretty good. It's a bunch 25 00:01:19,760 --> 00:01:23,680 Speaker 4: of analysts to arguing over stuff, and so FRDM came 26 00:01:23,760 --> 00:01:25,319 Speaker 4: up and I didn't realize how good. 27 00:01:25,200 --> 00:01:25,560 Speaker 2: It was doing. 28 00:01:25,640 --> 00:01:28,520 Speaker 4: Joel, here's the numbers. It's up one hundred and three 29 00:01:28,560 --> 00:01:33,160 Speaker 4: percent in the past five years. Emerging markets, we'll say, 30 00:01:33,520 --> 00:01:35,679 Speaker 4: measured by EEM. 31 00:01:35,000 --> 00:01:37,080 Speaker 2: Is up twenty percent. So think about it. 32 00:01:37,120 --> 00:01:40,720 Speaker 4: You're five xing the thing that you're also investing within. 33 00:01:41,440 --> 00:01:43,680 Speaker 4: It's not like I don't know some random crypto five 34 00:01:43,840 --> 00:01:47,600 Speaker 4: xing the S and P or something. Her stocks and 35 00:01:47,640 --> 00:01:50,320 Speaker 4: her countries are within EEM. So in other words, she 36 00:01:50,360 --> 00:01:53,840 Speaker 4: picked the right ones or the freedom story has just 37 00:01:53,960 --> 00:01:56,680 Speaker 4: really played out in an intense way right now. And 38 00:01:56,720 --> 00:01:58,480 Speaker 4: that one hundred percent, by the way, is even better 39 00:01:58,520 --> 00:02:01,000 Speaker 4: than the queues, which is a ninety two percent, And 40 00:02:01,040 --> 00:02:05,080 Speaker 4: it's a double EMC, which is I shares this emerging 41 00:02:05,120 --> 00:02:07,160 Speaker 4: markets x China, which actually had a nice run a 42 00:02:07,200 --> 00:02:09,959 Speaker 4: couple of years ago. So you're even because sometimes people 43 00:02:10,000 --> 00:02:12,560 Speaker 4: are like, well, FRDM is just x China, but not really. 44 00:02:12,600 --> 00:02:17,240 Speaker 4: It's actually done much greater than even EMXC. So I 45 00:02:17,280 --> 00:02:20,639 Speaker 4: was like, damn this, this is time to basically let 46 00:02:20,680 --> 00:02:23,400 Speaker 4: her maybe do a little victory lap and ask some 47 00:02:23,520 --> 00:02:24,240 Speaker 4: questions like. 48 00:02:24,200 --> 00:02:27,320 Speaker 2: The football, and you know what what happened? You know, 49 00:02:27,320 --> 00:02:30,240 Speaker 2: how how did this work out so perfectly. 50 00:02:32,880 --> 00:02:37,919 Speaker 1: This time on Trillions The Future of Freedom Perth, Welcome 51 00:02:37,919 --> 00:02:38,639 Speaker 1: back to Trillions. 52 00:02:39,680 --> 00:02:40,600 Speaker 3: Thanks so much for having me. 53 00:02:40,760 --> 00:02:42,520 Speaker 1: So we gave you kind of a long setup in 54 00:02:42,560 --> 00:02:48,760 Speaker 1: our intro there. Why why has this thesis worked so well? 55 00:02:49,000 --> 00:02:51,079 Speaker 3: Yeah? You know, I am so pleased with the way 56 00:02:51,160 --> 00:02:54,600 Speaker 3: that thesis has played out in this time period. I mean, 57 00:02:54,720 --> 00:02:58,080 Speaker 3: five years is not super short. It's not super long. 58 00:02:58,840 --> 00:03:01,760 Speaker 3: We've been around for all seven years. So the first 59 00:03:02,120 --> 00:03:03,440 Speaker 3: you know, first year and a half or so, it 60 00:03:03,480 --> 00:03:06,680 Speaker 3: was like COVID times coming out of COVID, and then 61 00:03:06,800 --> 00:03:10,360 Speaker 3: this five year run. So it has been an amazing run. 62 00:03:10,440 --> 00:03:14,080 Speaker 3: And you know, as as the you know, creator of 63 00:03:14,120 --> 00:03:16,760 Speaker 3: the of the strategy, I couldn't be happier for our 64 00:03:16,800 --> 00:03:20,320 Speaker 3: clients and just for the way that it's played out. So, 65 00:03:20,600 --> 00:03:23,440 Speaker 3: I mean, I think it's a confluence of many factors. 66 00:03:23,480 --> 00:03:26,760 Speaker 3: I cannot take credit for the market, but the strategy 67 00:03:26,840 --> 00:03:32,079 Speaker 3: did deliver the you know, the exposures to the freest 68 00:03:32,120 --> 00:03:36,080 Speaker 3: countries in the emerging market space, and that freedom story 69 00:03:36,280 --> 00:03:40,600 Speaker 3: has truly played out very well. You know, it's not 70 00:03:40,720 --> 00:03:44,240 Speaker 3: just one country. This past year twenty twenty five, South 71 00:03:44,280 --> 00:03:47,360 Speaker 3: Korea was the top performer. The year before that, Taiwan 72 00:03:47,520 --> 00:03:50,480 Speaker 3: was the top performer, the year before that it was Poland, 73 00:03:50,600 --> 00:03:53,200 Speaker 3: the year before that it was Chile. So it's been 74 00:03:53,240 --> 00:04:00,640 Speaker 3: a diversified kind of kind of outperformance in the country. 75 00:04:00,680 --> 00:04:02,320 Speaker 3: So those four that I just named are always in 76 00:04:02,360 --> 00:04:04,640 Speaker 3: the top four, have always been in the last of. 77 00:04:05,640 --> 00:04:10,160 Speaker 1: Those were the top four. So I'm curious, what, if anything, 78 00:04:10,520 --> 00:04:14,080 Speaker 1: have you changed along the way during those five years 79 00:04:14,120 --> 00:04:16,520 Speaker 1: of the ETF or the seven years of the index. 80 00:04:16,560 --> 00:04:18,480 Speaker 1: What what do you feel like have been the most 81 00:04:18,680 --> 00:04:20,880 Speaker 1: substantial tweaks you've made as you've gone. 82 00:04:23,200 --> 00:04:26,400 Speaker 3: So this is something I'm actually quite proud of. We've 83 00:04:26,400 --> 00:04:31,839 Speaker 3: made substantially no changes to the index methodology since the beginning, 84 00:04:31,839 --> 00:04:34,120 Speaker 3: and that is the idea of the index. Right. So 85 00:04:34,520 --> 00:04:37,120 Speaker 3: when I started this, as Eric mentioned, I am a 86 00:04:37,240 --> 00:04:41,800 Speaker 3: complete indie and total unknown, and I you know, did 87 00:04:41,839 --> 00:04:44,800 Speaker 3: not have the pedigree of a PM or fund manager 88 00:04:45,520 --> 00:04:47,800 Speaker 3: in the in the traditional sense, right. So I came 89 00:04:47,839 --> 00:04:51,200 Speaker 3: from Fidelity, where you know, we have the likes of 90 00:04:51,240 --> 00:04:54,599 Speaker 3: Will Danoff, you know, Peter Lynch. These guys are who 91 00:04:54,640 --> 00:04:56,919 Speaker 3: I imagine if they wanted to start something like this, 92 00:04:56,960 --> 00:04:58,960 Speaker 3: would do it actively, and it would be fine because 93 00:04:59,000 --> 00:05:01,960 Speaker 3: they have the name. I didn't have that. So the 94 00:05:01,960 --> 00:05:05,839 Speaker 3: only thing I could do is a systematic, rules based strategy. 95 00:05:05,880 --> 00:05:08,240 Speaker 3: And also that's what I wanted for this, because I 96 00:05:08,240 --> 00:05:11,440 Speaker 3: didn't want to be responsible for what countries were in, 97 00:05:11,480 --> 00:05:14,520 Speaker 3: what countries were out, what countries were you know, weighted higher. 98 00:05:14,560 --> 00:05:18,159 Speaker 3: We actually use only third party quantitative metrics from the 99 00:05:18,160 --> 00:05:20,920 Speaker 3: Cato Institute and the Fraser Institute. They you know, measure 100 00:05:21,000 --> 00:05:24,240 Speaker 3: freedom on eighty seven different variables, and we use the 101 00:05:24,279 --> 00:05:27,160 Speaker 3: composite free, you know, the composite equal weight of all 102 00:05:27,200 --> 00:05:30,679 Speaker 3: those variables. We don't even know weight any particular variable higher. 103 00:05:30,720 --> 00:05:34,680 Speaker 3: So we take no subjective stance and it's as objective 104 00:05:34,720 --> 00:05:38,640 Speaker 3: as possible. And so I think one thing that I'm 105 00:05:38,680 --> 00:05:41,039 Speaker 3: very proud of is we always rebalance on time. We 106 00:05:41,160 --> 00:05:45,279 Speaker 3: always stick to the methodology, and you know, our partners 107 00:05:45,320 --> 00:05:48,200 Speaker 3: at ETF architect also want to make sure that we 108 00:05:48,279 --> 00:05:50,560 Speaker 3: do that. So there's a layer of kind of compliance 109 00:05:50,600 --> 00:05:53,080 Speaker 3: there that says, okay, it's a passive strategy, it's going 110 00:05:53,120 --> 00:05:55,760 Speaker 3: to stay that way. And then our index committee also 111 00:05:56,000 --> 00:05:59,080 Speaker 3: access to checks and balances on you know, myself and 112 00:05:59,120 --> 00:05:59,920 Speaker 3: the indexes. 113 00:06:00,640 --> 00:06:02,440 Speaker 4: When I look at this fund and I compared to 114 00:06:02,480 --> 00:06:05,560 Speaker 4: EEM or the Emerging Markets benchmark, which is what a 115 00:06:05,560 --> 00:06:07,360 Speaker 4: lot of people own, So this is what a lot 116 00:06:07,360 --> 00:06:10,320 Speaker 4: of people own, it looks like there's about forty forty 117 00:06:10,360 --> 00:06:13,880 Speaker 4: five percent difference. It looks like, for example, if you 118 00:06:13,920 --> 00:06:17,040 Speaker 4: screen out China already, you just take twenty five percent 119 00:06:17,120 --> 00:06:20,479 Speaker 4: out of your portfolio. Then you've got Russia you screen out, 120 00:06:20,880 --> 00:06:22,560 Speaker 4: Then you've got a couple of Middle East countries like 121 00:06:22,560 --> 00:06:25,440 Speaker 4: Saudi Arabia and a handful of others. So I get 122 00:06:25,440 --> 00:06:27,719 Speaker 4: to around forty percent, So that gives you forty percent 123 00:06:27,800 --> 00:06:31,359 Speaker 4: budget to spend on these other countries which you overweight, 124 00:06:31,800 --> 00:06:35,960 Speaker 4: as you said earlier, Taiwan, South Korea, Chile, Poland. What 125 00:06:36,800 --> 00:06:40,520 Speaker 4: is driving the performance here is that those countries they're 126 00:06:41,080 --> 00:06:45,479 Speaker 4: more free and that has actually caught the investors' attention 127 00:06:45,920 --> 00:06:48,760 Speaker 4: and the outperformance of those countries. Or is it that 128 00:06:48,800 --> 00:06:52,480 Speaker 4: investors look at these less free countries and are turned off. 129 00:06:53,800 --> 00:06:56,919 Speaker 3: So yeah, it's both, And you know, a country attribution 130 00:06:57,200 --> 00:07:01,680 Speaker 3: would account for countries what account for about eighty three 131 00:07:01,760 --> 00:07:06,080 Speaker 3: to eighty four percent of the outperformance attribution in the 132 00:07:06,120 --> 00:07:10,480 Speaker 3: strategy in the past several years. Not having exposure to 133 00:07:10,600 --> 00:07:13,400 Speaker 3: Russia when Russia went into a war, not having exposure 134 00:07:13,440 --> 00:07:17,240 Speaker 3: to China when it all melted down, that really helped. 135 00:07:17,280 --> 00:07:21,040 Speaker 3: But it's really these out you know, out performing smaller 136 00:07:21,080 --> 00:07:24,320 Speaker 3: countries that are not very high weights in the other 137 00:07:24,360 --> 00:07:26,960 Speaker 3: indices that have really helped as well. And you know, 138 00:07:27,000 --> 00:07:29,800 Speaker 3: we do do that kind of country screening before the 139 00:07:29,840 --> 00:07:33,520 Speaker 3: freedom screening, where we look at a country market cap 140 00:07:34,360 --> 00:07:36,960 Speaker 3: as in relation to world market caps. So these are 141 00:07:36,960 --> 00:07:39,760 Speaker 3: countries that we have deemed to be large enough and 142 00:07:39,800 --> 00:07:43,600 Speaker 3: liquid enough to be included in a you know, exchange 143 00:07:43,600 --> 00:07:46,880 Speaker 3: traded product, but they are you know, less than one 144 00:07:46,880 --> 00:07:50,200 Speaker 3: percent in the cap weighted induses like the MESI in 145 00:07:50,240 --> 00:07:52,760 Speaker 3: footzy industy. So for example Chile and Poland, they're both 146 00:07:52,840 --> 00:07:56,400 Speaker 3: less than one percent in the other induses. So you know, 147 00:07:56,480 --> 00:07:59,720 Speaker 3: investors have in those in the cap weighted strategies have 148 00:07:59,760 --> 00:08:04,440 Speaker 3: really missed out on some of these higher growth, smaller 149 00:08:04,480 --> 00:08:07,240 Speaker 3: countries that are actually big enough to trade, it's just 150 00:08:07,240 --> 00:08:10,440 Speaker 3: not big enough for maybe their product, but or in 151 00:08:10,480 --> 00:08:13,240 Speaker 3: the cap waight at strategies are some much bigger countries. 152 00:08:13,360 --> 00:08:16,720 Speaker 3: So I'd say there's just been so much opportunity to 153 00:08:16,720 --> 00:08:19,880 Speaker 3: be captured in the freer emerging markets, and so happy 154 00:08:19,880 --> 00:08:22,440 Speaker 3: that we were able to capture some of that. 155 00:08:22,600 --> 00:08:24,720 Speaker 1: So do you think it's more because of what you 156 00:08:24,760 --> 00:08:27,480 Speaker 1: own or what you don't own? 157 00:08:27,920 --> 00:08:30,480 Speaker 3: It's more what we own, but what we don't own 158 00:08:30,720 --> 00:08:34,280 Speaker 3: definitely helped as well. Eighty three to eighty four percent 159 00:08:34,320 --> 00:08:38,880 Speaker 3: of the attributable outperformance is country selection. 160 00:08:46,960 --> 00:08:49,360 Speaker 4: So when you were starting off, I remember, I think 161 00:08:49,400 --> 00:08:51,319 Speaker 4: you were literally knocking on doors, like I think you 162 00:08:51,360 --> 00:08:54,720 Speaker 4: said you were going around the neighborhoods in Houston knocking 163 00:08:54,760 --> 00:08:57,520 Speaker 4: on doors and talking about your fund, and you probably 164 00:08:57,600 --> 00:09:01,000 Speaker 4: knew the investors in the fund at first. Then you 165 00:09:01,040 --> 00:09:02,959 Speaker 4: get this shiny object moment, and now this thing is 166 00:09:03,000 --> 00:09:04,360 Speaker 4: taken in money, hand over fist. 167 00:09:04,760 --> 00:09:06,800 Speaker 2: I think it's up to almost three billion dollars. 168 00:09:07,240 --> 00:09:09,560 Speaker 4: It's taken in like weekly flows for the past six 169 00:09:09,600 --> 00:09:12,000 Speaker 4: weeks something like that, and the flows are getting thicker. 170 00:09:12,000 --> 00:09:14,319 Speaker 4: We're talking like one hundred and fifty two million, three 171 00:09:14,400 --> 00:09:17,240 Speaker 4: hundred million a week. So the fish are jumping in 172 00:09:17,240 --> 00:09:21,480 Speaker 4: the boat, so to speak. Are you interacting with these 173 00:09:21,520 --> 00:09:24,000 Speaker 4: people or are you just sitting there going like wow, like, 174 00:09:24,040 --> 00:09:26,400 Speaker 4: where's all this money coming from? How does that work? 175 00:09:26,440 --> 00:09:29,800 Speaker 4: From knowing the investors in an intimate way to sort 176 00:09:29,840 --> 00:09:32,240 Speaker 4: of I guess blowing up is the right word here. 177 00:09:32,600 --> 00:09:35,520 Speaker 4: And then all of a sudden, you've got way more investors. 178 00:09:36,400 --> 00:09:38,600 Speaker 2: Do you know who they are? Do they talk to you? 179 00:09:39,120 --> 00:09:40,240 Speaker 2: Has your life changed? 180 00:09:40,320 --> 00:09:44,280 Speaker 4: Have you, you know, splurged on any nice cars or anything? 181 00:09:47,200 --> 00:09:49,640 Speaker 3: Yeah? I mean you gave me this, this super lay 182 00:09:49,720 --> 00:09:51,400 Speaker 3: up question chrying to get me to be happy and 183 00:09:51,440 --> 00:09:54,520 Speaker 3: in the moment when we were on ETFIQ the other day, 184 00:09:54,559 --> 00:09:57,760 Speaker 3: and I totally blew it by instead highlighting all our 185 00:09:57,760 --> 00:10:00,920 Speaker 3: periods of underperformance because I just refused to be in 186 00:10:00,960 --> 00:10:04,360 Speaker 3: the moment, And so I will I will re answer 187 00:10:04,440 --> 00:10:08,760 Speaker 3: that question now. Yes, my life is is different, but 188 00:10:08,800 --> 00:10:10,800 Speaker 3: it's not that different, you know. We I do have 189 00:10:11,040 --> 00:10:13,840 Speaker 3: a slightly nicer card. I literally traded it, you know, 190 00:10:15,000 --> 00:10:16,920 Speaker 3: X one for an xtram is literally like not a 191 00:10:17,000 --> 00:10:19,800 Speaker 3: huge difference, just because I drive around a bunch of teenagers. 192 00:10:21,120 --> 00:10:23,560 Speaker 3: I don't you know. My house is the same. I 193 00:10:23,600 --> 00:10:26,480 Speaker 3: haven't changed things that much. This is something that happened 194 00:10:26,600 --> 00:10:31,520 Speaker 3: very quickly over the last year. We like tripled our assets. 195 00:10:32,760 --> 00:10:35,120 Speaker 3: And yes, I do remember those early days. And I 196 00:10:35,120 --> 00:10:37,640 Speaker 3: actually missed those early days. And I was knocking on doors, 197 00:10:37,640 --> 00:10:40,400 Speaker 3: not you know, in Houston, because you know I was, 198 00:10:40,440 --> 00:10:43,040 Speaker 3: I was. I didn't know a lot of finance people 199 00:10:43,080 --> 00:10:45,880 Speaker 3: here except the Fidelity guys, which you know, they couldn't 200 00:10:46,040 --> 00:10:49,600 Speaker 3: do something like this at the time. I was knocking 201 00:10:49,600 --> 00:10:51,959 Speaker 3: on doors at ETF conferences. I don't know if you remember, 202 00:10:52,400 --> 00:10:55,520 Speaker 3: you know, meeting you at like ETF dot com inside 203 00:10:55,559 --> 00:10:58,000 Speaker 3: ECF twenty eighteen, getting you to you know, sign your 204 00:10:58,040 --> 00:10:59,880 Speaker 3: book or maybe that was twenty fifteen, I don't know, 205 00:11:00,960 --> 00:11:03,120 Speaker 3: and just you know, saying hello to all the like 206 00:11:03,360 --> 00:11:06,480 Speaker 3: networking with all the issuers, trying to get somebody to 207 00:11:06,559 --> 00:11:09,400 Speaker 3: launch the thing, and then nobody would do it, and 208 00:11:09,400 --> 00:11:11,160 Speaker 3: then finally somebody said they would do it, and then 209 00:11:11,240 --> 00:11:15,800 Speaker 3: after a conference at inside ETS they backed out. It 210 00:11:15,880 --> 00:11:19,040 Speaker 3: was the most you know, the worst into a conference ever, 211 00:11:19,200 --> 00:11:21,600 Speaker 3: you know, So it was a lot of that and 212 00:11:21,640 --> 00:11:24,160 Speaker 3: I remember those days, and I actually missed the time 213 00:11:24,200 --> 00:11:26,360 Speaker 3: when I had to struggle to get assets, when I 214 00:11:26,400 --> 00:11:29,880 Speaker 3: had to you know, convince people that it's not crazy 215 00:11:29,960 --> 00:11:32,520 Speaker 3: to not have China, not crazy to have a bunch 216 00:11:32,559 --> 00:11:36,360 Speaker 3: of Chilian, Poland in a fund for emerging markets. I 217 00:11:36,520 --> 00:11:39,280 Speaker 3: like being the contrarian and like the only voice in 218 00:11:39,280 --> 00:11:41,920 Speaker 3: the room saying something. So now it feels a little 219 00:11:42,000 --> 00:11:45,320 Speaker 3: less original and I feel like I'm saying the same 220 00:11:45,360 --> 00:11:48,200 Speaker 3: thing over and over. But I'm but I have no 221 00:11:48,240 --> 00:11:51,280 Speaker 3: complaints that absolutely, I'm thrilled with how this has turned out. 222 00:11:51,720 --> 00:11:52,679 Speaker 2: She's like Warren Buffett. 223 00:11:52,679 --> 00:11:54,280 Speaker 4: She could have the same house in ten years and 224 00:11:54,400 --> 00:11:56,720 Speaker 4: just just to make a point and drink cherry Coke 225 00:11:56,840 --> 00:12:00,920 Speaker 4: like all right anyway, By the way, in my opinion, 226 00:12:01,120 --> 00:12:05,439 Speaker 4: is the most punk rock person in the wholegf industry. 227 00:12:05,720 --> 00:12:07,600 Speaker 4: I always said when she comes on stage, it should 228 00:12:07,640 --> 00:12:10,400 Speaker 4: be too straight out of Compton from NWA. It just 229 00:12:10,480 --> 00:12:13,680 Speaker 4: suit or public enemy, something like that. There's something very 230 00:12:13,720 --> 00:12:16,560 Speaker 4: rebellious about what she's saying. Most of these other issuers 231 00:12:16,600 --> 00:12:19,920 Speaker 4: won't touch China. She will criticize it, and as we 232 00:12:20,000 --> 00:12:23,560 Speaker 4: know from following other news events, no one does. And 233 00:12:23,760 --> 00:12:27,760 Speaker 4: it's risky to be out there like that, and I 234 00:12:27,800 --> 00:12:30,720 Speaker 4: give her credit for that. It's there's something that always 235 00:12:30,720 --> 00:12:33,079 Speaker 4: interested me for somebody who was willing to sort of 236 00:12:33,120 --> 00:12:35,280 Speaker 4: go a little further out in the branch on any 237 00:12:35,320 --> 00:12:38,520 Speaker 4: issue in this particular case, it was criticizing some of 238 00:12:38,559 --> 00:12:44,720 Speaker 4: these dictators and authoritarian countries in a way other people 239 00:12:44,760 --> 00:12:48,280 Speaker 4: would not. And you know, other people even have products 240 00:12:48,760 --> 00:12:51,160 Speaker 4: that exclude certain countries, but they won't say a word. 241 00:12:51,520 --> 00:12:53,560 Speaker 2: It's just very interesting. Do you have any comment on that. 242 00:12:54,080 --> 00:12:56,800 Speaker 3: Yeah, so it's hard to speak out against autocracies, right. 243 00:12:56,840 --> 00:12:59,719 Speaker 3: I think I have an easier position for that, just 244 00:12:59,760 --> 00:13:02,720 Speaker 3: because because I have actual experience in the country. You know, 245 00:13:02,800 --> 00:13:05,240 Speaker 3: I'm actually I've born there. I came here at the 246 00:13:05,240 --> 00:13:07,960 Speaker 3: age of nine, I went back after college, lived in 247 00:13:07,960 --> 00:13:11,680 Speaker 3: Hong Kong and traveled throughout mainland China. Had you know, 248 00:13:12,080 --> 00:13:14,880 Speaker 3: personal experience with friends under the one child policy who 249 00:13:14,920 --> 00:13:18,120 Speaker 3: had no name, no birth certificate, no school records, just 250 00:13:18,120 --> 00:13:20,160 Speaker 3: because they were born a girl, and know that they're 251 00:13:20,160 --> 00:13:22,439 Speaker 3: the lucky ones. You know, there's sixty million missing women 252 00:13:22,440 --> 00:13:25,680 Speaker 3: missing in China in my generation. That's not something that 253 00:13:25,720 --> 00:13:29,640 Speaker 3: you can easily replace. So I think I have a 254 00:13:29,640 --> 00:13:32,800 Speaker 3: lot of more front roads experience, and so that gives 255 00:13:32,840 --> 00:13:37,440 Speaker 3: me a little more I guess credibility on the subject 256 00:13:37,679 --> 00:13:42,240 Speaker 3: that if you know, let's say, head of some big 257 00:13:42,280 --> 00:13:44,880 Speaker 3: firm in the US said something, it might not go 258 00:13:45,080 --> 00:13:49,000 Speaker 3: over as well. But yeah, I think freedom of speech 259 00:13:49,040 --> 00:13:51,880 Speaker 3: is important, freedom of medium is important, and so I'm 260 00:13:51,920 --> 00:13:55,400 Speaker 3: happy to most of the times say what I think 261 00:13:55,440 --> 00:13:57,160 Speaker 3: is true. 262 00:13:56,760 --> 00:14:02,520 Speaker 1: So we've actually seen off a fair amount of democratic 263 00:14:03,320 --> 00:14:05,920 Speaker 1: backsliding throughout the rest of the world and the rise 264 00:14:05,960 --> 00:14:09,280 Speaker 1: of populism and developed markets. And this is since we 265 00:14:09,360 --> 00:14:12,439 Speaker 1: talked to you last even I'm curious how you're looking 266 00:14:12,440 --> 00:14:16,480 Speaker 1: at at that and is there another opportunity for I'll 267 00:14:16,520 --> 00:14:19,800 Speaker 1: call it a sophomore album from Perthle that's not about 268 00:14:19,840 --> 00:14:22,320 Speaker 1: emerging markets but might be more about the developed world. 269 00:14:23,760 --> 00:14:25,840 Speaker 3: So you know, you know what's interesting. So right now 270 00:14:26,920 --> 00:14:31,120 Speaker 3: we are getting we are getting demand from global global 271 00:14:31,120 --> 00:14:35,160 Speaker 3: investors from all over the world for the emerging markets product, 272 00:14:35,320 --> 00:14:37,280 Speaker 3: and so there are people that are now trying to 273 00:14:37,280 --> 00:14:41,240 Speaker 3: package the product for their own you know, currencies and 274 00:14:41,800 --> 00:14:44,400 Speaker 3: in a way that their clients can invest in a 275 00:14:44,440 --> 00:14:48,640 Speaker 3: tax efficient manner. And then in the US we're getting 276 00:14:48,640 --> 00:14:53,080 Speaker 3: more requests for developed market products. So developed markets, you know, 277 00:14:53,360 --> 00:14:57,640 Speaker 3: there's not as much divergence and freedom levels. It's more 278 00:14:57,640 --> 00:15:02,520 Speaker 3: homogeneous and they're all relative high in freedom levels. So 279 00:15:02,520 --> 00:15:05,560 Speaker 3: the thing that I've noticed with the with the rise 280 00:15:05,560 --> 00:15:08,840 Speaker 3: of populism around the world is that in some of 281 00:15:08,880 --> 00:15:11,880 Speaker 3: these emerging markets, which is what I've been watching. When 282 00:15:11,880 --> 00:15:14,880 Speaker 3: we see that happening, the checks and balances and the 283 00:15:14,880 --> 00:15:18,440 Speaker 3: institutions in the freer ones do prove to be strong. 284 00:15:18,560 --> 00:15:20,680 Speaker 3: You know, voters come out and drove to vote in 285 00:15:21,040 --> 00:15:23,880 Speaker 3: you know, more balanced government in countries like Chile and 286 00:15:23,920 --> 00:15:28,560 Speaker 3: poland recently South Korea just jailed their you know, ex 287 00:15:28,600 --> 00:15:32,440 Speaker 3: president for life for unilaterally declaring martial law one day. 288 00:15:33,560 --> 00:15:36,560 Speaker 3: You know, these types of checks and balances and stronger 289 00:15:36,560 --> 00:15:40,040 Speaker 3: institutions in civil society is what I'm what I'm seeing 290 00:15:40,160 --> 00:15:44,280 Speaker 3: happening in the freer EMS and then d MS, Yes 291 00:15:44,360 --> 00:15:46,840 Speaker 3: there is. I do see that there's a little more 292 00:15:46,840 --> 00:15:49,480 Speaker 3: opportunity than the before, as there is a little more 293 00:15:49,520 --> 00:15:52,840 Speaker 3: divergence than before with the rise of populism, But a 294 00:15:52,840 --> 00:15:54,760 Speaker 3: lot of that rise of populism is also happening in 295 00:15:54,800 --> 00:15:58,960 Speaker 3: the smaller d ms or in the in the larger EMS. 296 00:15:59,480 --> 00:16:02,320 Speaker 4: Let me this real quick, because I think people in 297 00:16:02,400 --> 00:16:05,280 Speaker 4: the US were so spoiled with all our freedom that 298 00:16:05,440 --> 00:16:08,920 Speaker 4: like the tiniest little thing which is like no big deal. 299 00:16:08,960 --> 00:16:13,240 Speaker 4: People like freedom of speech is dead and it's like okay, relax, 300 00:16:14,000 --> 00:16:17,560 Speaker 4: can you help I guess give context or perspective to 301 00:16:17,640 --> 00:16:21,480 Speaker 4: people who might think, oh my god, the US probably 302 00:16:21,640 --> 00:16:26,520 Speaker 4: it would wouldn't make her screening process. Now that's absurd, right. 303 00:16:27,960 --> 00:16:30,880 Speaker 3: It is. I'm gonna I'm gonna push back on that, 304 00:16:30,920 --> 00:16:34,720 Speaker 3: little Eric, So, yes, that is absolutely absurd. US is, 305 00:16:34,920 --> 00:16:36,720 Speaker 3: you know, number fifteen out of one hundred and sixty 306 00:16:36,720 --> 00:16:39,960 Speaker 3: five countries on the you know, Human Freedom Index by 307 00:16:40,000 --> 00:16:44,240 Speaker 3: Cato and Fraser, So you know, are that's on par 308 00:16:44,360 --> 00:16:46,840 Speaker 3: with our top ems that are included in the fund. 309 00:16:47,200 --> 00:16:50,160 Speaker 3: So yeah, it's it definitely would not be an exclusion 310 00:16:50,560 --> 00:16:53,880 Speaker 3: if we did something right. So that's not even a possibility. 311 00:16:53,920 --> 00:16:56,440 Speaker 3: And it's just so far from you know, the lower 312 00:16:56,520 --> 00:16:59,080 Speaker 3: scoring countries like like you know, China, Saudi Arabia and 313 00:16:59,080 --> 00:17:01,960 Speaker 3: so forth, where you say something and you can literally 314 00:17:02,080 --> 00:17:05,360 Speaker 3: be disappeared for it, or your famili's disappeared, you know overnight, 315 00:17:05,480 --> 00:17:08,080 Speaker 3: or your IPO is scrapped or you know, you're now 316 00:17:08,119 --> 00:17:12,439 Speaker 3: a nonprofit you know. So that's that's completely like a 317 00:17:12,440 --> 00:17:18,120 Speaker 3: different universe. But the latest report from Cato and Fraser 318 00:17:18,240 --> 00:17:21,119 Speaker 3: did come out and say that the US's score is 319 00:17:21,160 --> 00:17:25,480 Speaker 3: expected to decline because of things like government interference in 320 00:17:25,680 --> 00:17:28,399 Speaker 3: private market activity, so like government taking stakes in private 321 00:17:28,400 --> 00:17:31,280 Speaker 3: companies and things like the tariffs. Now I don't know 322 00:17:31,320 --> 00:17:33,400 Speaker 3: if that's going to be different now that the terrors 323 00:17:33,400 --> 00:17:37,000 Speaker 3: have been shot down, which does show some checks and balances, 324 00:17:37,680 --> 00:17:41,560 Speaker 3: and whether that will last. So that that is, you know, 325 00:17:41,600 --> 00:17:45,879 Speaker 3: some of the more protectionists policies on trade and the 326 00:17:45,960 --> 00:17:52,000 Speaker 3: interference the size of government in private markets. The score 327 00:17:52,040 --> 00:17:54,040 Speaker 3: for the US is expected to decrease, but you know, 328 00:17:54,080 --> 00:17:57,000 Speaker 3: the the decrease in score doesn't mean it's not it's 329 00:17:57,000 --> 00:18:00,359 Speaker 3: not like a drastic situation. It's just, hey, work's affecting 330 00:18:00,480 --> 00:18:03,240 Speaker 3: something here. And those are two variables that I mentioned 331 00:18:03,280 --> 00:18:08,080 Speaker 3: out of eighty seven. So yeah, there are some concerns, 332 00:18:08,119 --> 00:18:10,960 Speaker 3: and I think it's good for people in a freer 333 00:18:11,000 --> 00:18:17,040 Speaker 3: market to be very vigilant, maybe hypervigilant, because you know, yeah, 334 00:18:17,080 --> 00:18:21,080 Speaker 3: freedom is it's a very uh, it's a fragile thing. 335 00:18:29,240 --> 00:18:33,080 Speaker 1: Because you're watching the Cato and the Fraser indexes so closely. 336 00:18:33,680 --> 00:18:38,240 Speaker 1: I'm wondering if you think there's another emerging market that 337 00:18:38,400 --> 00:18:41,560 Speaker 1: might be approaching something of a breakout moment. Since we've 338 00:18:41,560 --> 00:18:45,840 Speaker 1: talked about South Korea and Taiwan and Chile and Poland, 339 00:18:45,880 --> 00:18:49,120 Speaker 1: like those are some somewhat expected, I guess, are there anybody? 340 00:18:49,359 --> 00:18:52,480 Speaker 1: Is there anybody who's unexpected that you're you know, got 341 00:18:52,480 --> 00:18:53,159 Speaker 1: your eye trained on. 342 00:18:55,760 --> 00:18:59,320 Speaker 3: So a lot of these countries that are geographically close 343 00:18:59,400 --> 00:19:02,840 Speaker 3: to very on free markets are getting an influx of 344 00:19:03,240 --> 00:19:07,880 Speaker 3: human capital. So countries like Colombia getting a lot of 345 00:19:08,880 --> 00:19:13,359 Speaker 3: immigrants from Venezuela for example, a lot of migration there. 346 00:19:13,560 --> 00:19:17,160 Speaker 3: Countries like Poland getting a lot of migration from Ukraine. 347 00:19:18,080 --> 00:19:20,920 Speaker 3: So these are countries that are benefiting from this kind 348 00:19:20,960 --> 00:19:24,160 Speaker 3: of freedom of movement that is coming into their country 349 00:19:24,200 --> 00:19:27,399 Speaker 3: from very unfree markets that will show up in the 350 00:19:27,480 --> 00:19:32,480 Speaker 3: long run. In the short run, actually, India, their population 351 00:19:32,720 --> 00:19:36,000 Speaker 3: just surpassed China's. India is a country that in our 352 00:19:36,040 --> 00:19:38,440 Speaker 3: index goes in and out from year to year quite 353 00:19:38,440 --> 00:19:41,119 Speaker 3: often just because they're right at the average of the 354 00:19:41,160 --> 00:19:46,640 Speaker 3: emerging market eligible Universe peers. And so they are out 355 00:19:46,640 --> 00:19:49,600 Speaker 3: this year, they were in last year. And they've historically, 356 00:19:49,720 --> 00:19:53,399 Speaker 3: as we mentioned, had very high trade protections tariffs and 357 00:19:53,400 --> 00:19:56,800 Speaker 3: non tariff trade barriers that has weighed on their economic 358 00:19:56,800 --> 00:20:00,280 Speaker 3: freedom score and had some other issues on the personal 359 00:20:00,320 --> 00:20:02,520 Speaker 3: freedom side as well, like freedom of media, like they 360 00:20:02,600 --> 00:20:05,600 Speaker 3: you know rated Modi's when they did VBC did the 361 00:20:06,240 --> 00:20:08,880 Speaker 3: story on MODI, they rated their offices, you know, things 362 00:20:08,920 --> 00:20:11,960 Speaker 3: like that. So there's issues and they come in and out. 363 00:20:12,040 --> 00:20:15,679 Speaker 3: But the population growth is undeniable, and you know, demographics 364 00:20:16,000 --> 00:20:18,760 Speaker 3: our destiny, so especially in emerging markets. So I'm very 365 00:20:18,760 --> 00:20:23,359 Speaker 3: bullish on them. Now, my opinion does not factor into 366 00:20:23,440 --> 00:20:26,440 Speaker 3: the methodology whatsoever. So that's just my opinion. 367 00:20:26,119 --> 00:20:28,720 Speaker 1: On that, Okay. And what about the Middle East, because 368 00:20:28,760 --> 00:20:31,840 Speaker 1: there's been so much kind of deal making over there, 369 00:20:32,160 --> 00:20:37,200 Speaker 1: and we're talking like, you know, big, big, big numbers. 370 00:20:37,720 --> 00:20:40,840 Speaker 1: Is there anything there that feels like it's something to 371 00:20:40,920 --> 00:20:44,560 Speaker 1: watch or or do? The rules just simply mean there's 372 00:20:44,640 --> 00:20:47,639 Speaker 1: few and far between as opportunities to go. 373 00:20:48,440 --> 00:20:50,639 Speaker 3: Yeah. So the Middle East is interesting because if I 374 00:20:50,720 --> 00:20:55,159 Speaker 3: did only economic freedom, they would score actually quite high. 375 00:20:55,280 --> 00:20:58,840 Speaker 3: Countries like Saudi Arabia, cutter UAE. These are countries that 376 00:20:58,880 --> 00:21:01,760 Speaker 3: score very high on eco nomic freedom. But because our 377 00:21:02,160 --> 00:21:05,399 Speaker 3: data set uses both personal and economic freedoms, so civil, 378 00:21:05,400 --> 00:21:08,600 Speaker 3: political and economic, and the personal freedom is half of 379 00:21:08,720 --> 00:21:13,200 Speaker 3: the overall you know score, they are actually scoring quite 380 00:21:13,240 --> 00:21:18,160 Speaker 3: low just because the majority of that being there very 381 00:21:18,160 --> 00:21:23,680 Speaker 3: bad women's rights in these countries and freedom of women's speech, expression, etc. 382 00:21:24,040 --> 00:21:26,960 Speaker 3: So in these these countries are also very oil rich, 383 00:21:27,000 --> 00:21:34,040 Speaker 3: They're very resource rich, but without the diversification of industries 384 00:21:34,040 --> 00:21:36,000 Speaker 3: that you see in some of the freer markets. 385 00:21:36,480 --> 00:21:40,680 Speaker 1: Eric brought up your the tremendous inflows that you've you've 386 00:21:40,720 --> 00:21:43,480 Speaker 1: seen over the last You've made it sound like it's 387 00:21:43,480 --> 00:21:46,720 Speaker 1: really been within the last year or so. I'm curious 388 00:21:47,080 --> 00:21:49,840 Speaker 1: what what do you feel like you can attribute that to. 389 00:21:50,000 --> 00:21:55,560 Speaker 1: Has it really been about American investors looking for international opportunities? 390 00:21:56,119 --> 00:21:59,719 Speaker 1: Is it the sell America idea? Is it is it 391 00:22:00,119 --> 00:22:02,720 Speaker 1: just a reaction to Trump or or is it is 392 00:22:02,760 --> 00:22:05,200 Speaker 1: it performance chasing or something else. 393 00:22:06,200 --> 00:22:09,159 Speaker 3: Yeah, I think it's a confluence of factors. I agree 394 00:22:09,200 --> 00:22:13,080 Speaker 3: with Eric that I don't think sell America is like sustainable, 395 00:22:13,960 --> 00:22:16,800 Speaker 3: but I think that there is a higher you know, 396 00:22:16,880 --> 00:22:20,320 Speaker 3: there has been a performance rotation between the US and 397 00:22:20,800 --> 00:22:24,320 Speaker 3: developed markets and emerging markets, so you know, both developed 398 00:22:24,359 --> 00:22:26,960 Speaker 3: and emerging markets outperformed the US last year for the 399 00:22:26,960 --> 00:22:29,879 Speaker 3: first time in forever. So I think there's been some 400 00:22:29,960 --> 00:22:36,040 Speaker 3: attention to diversification. And if emerging markets, for example, were 401 00:22:36,040 --> 00:22:38,439 Speaker 3: to have a breakout again like in the you know, 402 00:22:38,760 --> 00:22:42,639 Speaker 3: early like two thousands, then then yeah, I think there 403 00:22:42,680 --> 00:22:46,400 Speaker 3: would be a lot more diversifying into the emerging markets, 404 00:22:46,680 --> 00:22:49,320 Speaker 3: and I think that's ultimately it's good because you don't 405 00:22:49,320 --> 00:22:50,560 Speaker 3: know what's going to go up, you don't know what's 406 00:22:50,560 --> 00:22:54,159 Speaker 3: going to go down. That's why we we diversify. So 407 00:22:54,200 --> 00:22:57,040 Speaker 3: it's never too late to do that. And I think 408 00:22:57,160 --> 00:22:59,560 Speaker 3: in the US, because the US market is so strong, 409 00:23:00,440 --> 00:23:02,399 Speaker 3: there is a lot of home country bias. And you know, 410 00:23:02,440 --> 00:23:04,360 Speaker 3: I was an advisor. I know this, and I had 411 00:23:04,359 --> 00:23:07,720 Speaker 3: a lot of home country bias. I still do so, 412 00:23:07,720 --> 00:23:11,879 Speaker 3: so I do think that this sell America is not 413 00:23:12,119 --> 00:23:14,920 Speaker 3: the trade, but diversification is always helpful. 414 00:23:15,320 --> 00:23:16,240 Speaker 2: Yeah, we looked at it. 415 00:23:16,280 --> 00:23:19,879 Speaker 4: We thought the cellomrapy, the way they started sell America 416 00:23:19,960 --> 00:23:22,160 Speaker 4: and the tariffs last year when the market was down 417 00:23:22,200 --> 00:23:24,920 Speaker 4: like twenty percent. Now they use it every day when 418 00:23:24,960 --> 00:23:27,320 Speaker 4: the market has like a down day. They're like, sol 419 00:23:27,359 --> 00:23:30,439 Speaker 4: America is back. I'm like, DALs off like one hundred points. 420 00:23:30,760 --> 00:23:32,959 Speaker 4: I'm like, all right, relax, you're gonna cry wolf here. 421 00:23:33,000 --> 00:23:36,240 Speaker 4: Won't mean anything. But anyway, we haven't noticed sell America. 422 00:23:36,280 --> 00:23:39,240 Speaker 4: But we have noticed is people buying some of the things, 423 00:23:39,520 --> 00:23:40,960 Speaker 4: and that could be gold to gold. 424 00:23:40,760 --> 00:23:43,760 Speaker 2: Had a nice run international. 425 00:23:43,119 --> 00:23:47,920 Speaker 4: ETFs cash, so people are kind of hedging America maybe 426 00:23:47,960 --> 00:23:49,000 Speaker 4: not selling it. 427 00:23:49,000 --> 00:23:52,159 Speaker 3: It's a diversification, right, because most people are overweight the 428 00:23:52,320 --> 00:23:54,480 Speaker 3: US as because of the outperformance. 429 00:23:54,600 --> 00:23:57,320 Speaker 4: I think what's happening in your case is you do 430 00:23:57,400 --> 00:24:00,760 Speaker 4: have a core base of people who believe in the strategy, 431 00:24:01,480 --> 00:24:04,480 Speaker 4: but now you're getting some tourists who are like, ooh, look, 432 00:24:04,520 --> 00:24:08,720 Speaker 4: shiny object. And it happened with ARC, happened with Bitcoin, 433 00:24:08,760 --> 00:24:12,040 Speaker 4: happens everybody. The good news is, let's say it goes down, 434 00:24:12,080 --> 00:24:15,960 Speaker 4: has a bad run, you want half of those tourists 435 00:24:16,000 --> 00:24:19,520 Speaker 4: will stay, and then your base will stay, and it's 436 00:24:19,520 --> 00:24:21,600 Speaker 4: you just need to break through one time and you 437 00:24:21,640 --> 00:24:24,600 Speaker 4: will just live on as a liquid known ETF that 438 00:24:24,640 --> 00:24:25,280 Speaker 4: does this thing. 439 00:24:25,359 --> 00:24:27,919 Speaker 2: So I think that's how I see it. 440 00:24:27,960 --> 00:24:29,639 Speaker 4: But I do see some of the flows in the 441 00:24:29,640 --> 00:24:32,359 Speaker 4: past six weeks because that's when it really got. I 442 00:24:32,359 --> 00:24:35,560 Speaker 4: think your assets probably doubled in the last month or two, right, 443 00:24:35,640 --> 00:24:38,480 Speaker 4: something like that. I think some of those are probably 444 00:24:39,040 --> 00:24:40,639 Speaker 4: just so enamored by the performance. 445 00:24:41,359 --> 00:24:41,840 Speaker 2: Is that fair? 446 00:24:41,960 --> 00:24:46,240 Speaker 3: Yeah, there's definitely probably some you know, people are screening 447 00:24:46,280 --> 00:24:49,080 Speaker 3: for performance in whatever screen they use and finding it 448 00:24:49,680 --> 00:24:50,320 Speaker 3: near the top. 449 00:24:50,400 --> 00:24:55,320 Speaker 4: And yeah, but Perth ontfi, Yeah, I know, and Perth 450 00:24:55,400 --> 00:24:57,120 Speaker 4: is smart and she hangs out with Wes Gray, who's 451 00:24:57,119 --> 00:25:00,520 Speaker 4: always talking about this. She was on ETFIQ and she goes, listen, 452 00:25:00,640 --> 00:25:04,040 Speaker 4: it won't always be like this. We're gonna have downtimes. Please, 453 00:25:04,600 --> 00:25:08,600 Speaker 4: first person ever PM on TV who said no, if 454 00:25:08,640 --> 00:25:10,880 Speaker 4: things could get bad, I appreciate that. 455 00:25:10,880 --> 00:25:13,720 Speaker 1: But this sounds so good. The line that she had 456 00:25:13,720 --> 00:25:16,439 Speaker 1: in the show on ETFIQ that I wrote down, freedom 457 00:25:16,560 --> 00:25:18,719 Speaker 1: is not a trade, It is an investment. I was like, 458 00:25:19,080 --> 00:25:19,640 Speaker 1: that is a. 459 00:25:19,560 --> 00:25:21,040 Speaker 2: Great, great line. 460 00:25:21,080 --> 00:25:23,040 Speaker 4: Did that just pop out or is that like something 461 00:25:23,040 --> 00:25:24,560 Speaker 4: that's in your like is that your motto? 462 00:25:25,960 --> 00:25:29,400 Speaker 3: That's a kind of in my notes? And that came 463 00:25:29,440 --> 00:25:32,919 Speaker 3: from from Mark Absy, my friend who is on the 464 00:25:32,920 --> 00:25:33,760 Speaker 3: Index committee as well. 465 00:25:33,880 --> 00:25:34,560 Speaker 2: Yeah, I know him. 466 00:25:34,600 --> 00:25:36,440 Speaker 3: He was like, oh, you're gonna be on IQ. Remember 467 00:25:36,840 --> 00:25:37,240 Speaker 3: freedom is. 468 00:25:37,480 --> 00:25:39,120 Speaker 4: He gives me crap on Twitter butt once a month 469 00:25:39,359 --> 00:25:42,120 Speaker 4: he comes in. He just comes into my replies and 470 00:25:42,480 --> 00:25:42,920 Speaker 4: it's great. 471 00:25:42,960 --> 00:25:43,520 Speaker 2: He's a great guy. 472 00:25:43,640 --> 00:25:46,119 Speaker 1: But the thing that if I really step back and 473 00:25:46,119 --> 00:25:48,359 Speaker 1: think about this, so much of what we talk about 474 00:25:48,440 --> 00:25:51,600 Speaker 1: with with ETFs over you know, the almost ten years 475 00:25:51,640 --> 00:25:55,000 Speaker 1: we've been doing this podcast is is most of it 476 00:25:55,040 --> 00:25:57,600 Speaker 1: is tied to an index and is passive, and yet 477 00:25:57,680 --> 00:25:59,760 Speaker 1: you've managed to come up with a way of not 478 00:25:59,800 --> 00:26:05,359 Speaker 1: only having a passive approach, but really fundamentally an engaging 479 00:26:05,720 --> 00:26:09,280 Speaker 1: active management argument. And I'm curious when you kind of 480 00:26:09,600 --> 00:26:12,520 Speaker 1: see what you've been able to find here and you 481 00:26:12,560 --> 00:26:16,520 Speaker 1: think about the universe of active investing and potentially the 482 00:26:16,560 --> 00:26:20,359 Speaker 1: future of active investing, Like, what guidance or lessons do 483 00:26:20,400 --> 00:26:24,879 Speaker 1: you think you and Freedom have for active investing as 484 00:26:24,920 --> 00:26:25,240 Speaker 1: a whole? 485 00:26:26,240 --> 00:26:27,720 Speaker 3: Are you looking at Freedom as active? 486 00:26:27,760 --> 00:26:30,240 Speaker 1: Are you looking at a Yeah, I look at it 487 00:26:30,240 --> 00:26:33,000 Speaker 1: as active because you have an index, but you're and 488 00:26:33,040 --> 00:26:36,280 Speaker 1: you have rules and methodology and you adhere to them. 489 00:26:36,520 --> 00:26:40,640 Speaker 1: But fundamentally, you know, there's still an active call here 490 00:26:40,680 --> 00:26:44,560 Speaker 1: where you have an investment thesis that you're adhering to. 491 00:26:45,720 --> 00:26:47,760 Speaker 3: Yeah. So I think we saw a lot of And 492 00:26:48,080 --> 00:26:50,240 Speaker 3: this is something that occurred to me during COVID, which 493 00:26:50,400 --> 00:26:52,200 Speaker 3: is and I think people pointed this out to me 494 00:26:52,280 --> 00:26:56,000 Speaker 3: as well, not just occurred to me, But there are 495 00:26:56,560 --> 00:26:59,439 Speaker 3: you know, different ways to slice and dice the market 496 00:26:59,640 --> 00:27:03,959 Speaker 3: and market cab waiting is often not only ineffective, but 497 00:27:04,000 --> 00:27:07,200 Speaker 3: it's often flawed. Now, it does work very well when 498 00:27:07,200 --> 00:27:11,040 Speaker 3: markets are very liquid and very large, right, so develop 499 00:27:11,080 --> 00:27:14,119 Speaker 3: markets US market works very well it's very hard to beat. 500 00:27:14,880 --> 00:27:17,439 Speaker 3: But when you get into kind of smaller segments like 501 00:27:17,560 --> 00:27:23,000 Speaker 3: emerging markets, for example, maybe the other strategy or another 502 00:27:23,040 --> 00:27:25,000 Speaker 3: strategy is to look around the world and see what's 503 00:27:25,040 --> 00:27:27,240 Speaker 3: going on and then invest that way. So and that's 504 00:27:27,240 --> 00:27:30,200 Speaker 3: what ARC did. That's what we did, and a lot 505 00:27:30,200 --> 00:27:32,560 Speaker 3: of these thematics that's what they do. So I think 506 00:27:32,600 --> 00:27:37,280 Speaker 3: thematic is something that I've always kind of kind of liked. 507 00:27:37,040 --> 00:27:40,600 Speaker 3: And the other thing about that is when people invest 508 00:27:40,760 --> 00:27:43,879 Speaker 3: in a thematic or something that has a thing that 509 00:27:43,920 --> 00:27:47,040 Speaker 3: they believe in, it's easier for them to stick to 510 00:27:47,119 --> 00:27:49,920 Speaker 3: it in bad times. So you know, like Eric said, 511 00:27:49,920 --> 00:27:54,040 Speaker 3: I'm hoping that our tours coming in now are performance chasers. 512 00:27:54,280 --> 00:27:56,160 Speaker 3: If I could say anything to them, I would say, yes, 513 00:27:57,080 --> 00:27:59,320 Speaker 3: zoom in on those periods of underperformance, because we do 514 00:27:59,400 --> 00:28:01,200 Speaker 3: have those as well. Look at this as a long 515 00:28:01,320 --> 00:28:05,640 Speaker 3: term but also know that, yes, freedom is an investment, 516 00:28:05,720 --> 00:28:09,200 Speaker 3: is not a trade. And if you're an advisor going 517 00:28:09,200 --> 00:28:12,240 Speaker 3: into this for your clients, when things are bad, let's 518 00:28:12,280 --> 00:28:15,600 Speaker 3: say that we underperform because for example, China or Saudi 519 00:28:15,600 --> 00:28:20,160 Speaker 3: Arabia outperforms, tell them that's why that you were underperforming, 520 00:28:20,240 --> 00:28:23,919 Speaker 3: And most investors will be happy with that. I am 521 00:28:23,960 --> 00:28:27,320 Speaker 3: an investor in this fund, and you know, I find 522 00:28:27,320 --> 00:28:29,600 Speaker 3: it very easy to stick to in bad times, just 523 00:28:29,600 --> 00:28:33,640 Speaker 3: because I do absolutely believe in the strategy. So when 524 00:28:33,640 --> 00:28:36,159 Speaker 3: you're investing in a theme or a strategy that you 525 00:28:36,280 --> 00:28:38,880 Speaker 3: believe in, it's much easier to stick to it in 526 00:28:38,880 --> 00:28:45,120 Speaker 3: the bad times, and that alone will increase your chances 527 00:28:45,120 --> 00:28:46,240 Speaker 3: for success in a long run. 528 00:28:46,440 --> 00:28:50,720 Speaker 1: All right, last question, if you were launching a faradium 529 00:28:50,960 --> 00:28:53,080 Speaker 1: again today, what would you do differently. 530 00:28:54,400 --> 00:28:58,480 Speaker 3: That's a really good question. I think I would not 531 00:28:58,600 --> 00:29:07,840 Speaker 3: be as stressed. Yeah, I would be a little more chill. 532 00:29:09,240 --> 00:29:11,959 Speaker 3: So I you know, I really love the way that 533 00:29:12,040 --> 00:29:13,920 Speaker 3: this all turned out. You know, I work with the 534 00:29:13,960 --> 00:29:17,640 Speaker 3: best operating partners in the world. ETF Architect, those guys 535 00:29:17,680 --> 00:29:20,800 Speaker 3: Wes Gray. I have the best LPs in the world, 536 00:29:20,920 --> 00:29:23,680 Speaker 3: Rob are Not and my other LP over in the UK. 537 00:29:23,720 --> 00:29:26,080 Speaker 3: Who wants to, you know, be anonymous, but you know 538 00:29:26,120 --> 00:29:28,440 Speaker 3: it's it's it's you know, I I work with the 539 00:29:28,480 --> 00:29:32,720 Speaker 3: best people. I was able to because we went so 540 00:29:32,760 --> 00:29:35,320 Speaker 3: slow in the early years, because I was being you know, 541 00:29:35,440 --> 00:29:38,080 Speaker 3: mom to young child at the same time, I was 542 00:29:38,120 --> 00:29:40,360 Speaker 3: able to spend some time getting to know the industry, 543 00:29:40,360 --> 00:29:44,440 Speaker 3: getting to know people like Eric and just had so 544 00:29:44,560 --> 00:29:46,560 Speaker 3: much support. And I believe that we have support that 545 00:29:46,560 --> 00:29:48,680 Speaker 3: I don't even know about because we've had times like 546 00:29:48,720 --> 00:29:51,680 Speaker 3: in the first five years. Eric pointed this out. The 547 00:29:51,720 --> 00:29:54,240 Speaker 3: first like five years we had no outflows, like no 548 00:29:54,920 --> 00:29:58,080 Speaker 3: net redemption days. I believe that we have so many 549 00:29:58,080 --> 00:30:02,520 Speaker 3: supporters out there that that we're rooting for us this 550 00:30:02,560 --> 00:30:05,560 Speaker 3: whole time, and I just wanted to or if I 551 00:30:05,600 --> 00:30:07,719 Speaker 3: were to do this over, I would focus more on 552 00:30:07,720 --> 00:30:10,680 Speaker 3: that and stress out less. I'm very stressed because I 553 00:30:10,680 --> 00:30:15,760 Speaker 3: also have a teenager, so you know, and times when 554 00:30:16,080 --> 00:30:19,680 Speaker 3: I have an opportunity to celebrate with people who have 555 00:30:19,720 --> 00:30:23,000 Speaker 3: supported us since day, you know, minus three hundred, like 556 00:30:23,000 --> 00:30:26,240 Speaker 3: like you guys like Eric, you know, when he gives 557 00:30:26,280 --> 00:30:28,760 Speaker 3: me a layup question on TV, I would answer it 558 00:30:28,800 --> 00:30:32,360 Speaker 3: better and be happier and not be like, please see 559 00:30:32,360 --> 00:30:36,040 Speaker 3: our periods of underperformance. But you know, again, that's how 560 00:30:36,280 --> 00:30:38,560 Speaker 3: I was trained, and I work with people who make 561 00:30:38,600 --> 00:30:41,840 Speaker 3: sure I still do that. So It's unlikely that I'll 562 00:30:41,880 --> 00:30:44,280 Speaker 3: be able to relax, but that's what I would do 563 00:30:44,400 --> 00:30:45,360 Speaker 3: if I could do it better. 564 00:30:45,640 --> 00:30:47,960 Speaker 1: We'll leave it there, Pertle. Thanks for joining us on 565 00:30:48,000 --> 00:30:58,360 Speaker 1: trillions again. Thanks for listening to Trillions until next time. 566 00:30:58,360 --> 00:31:01,160 Speaker 1: You can find us on the Bloomberg Terminal, bloomberg dot com, 567 00:31:01,200 --> 00:31:03,400 Speaker 1: Apple Podcasts, Spotify. 568 00:31:03,520 --> 00:31:04,800 Speaker 2: Or wherever else you'd like to listen. 569 00:31:05,080 --> 00:31:06,600 Speaker 1: We'd love to hear from you. Hit us up on 570 00:31:06,640 --> 00:31:10,040 Speaker 1: social I'm at Joel Weber Show, He's at Eric Balcino's. 571 00:31:10,360 --> 00:31:12,240 Speaker 1: Trillions is produced by Magnus Hendrickson.