Speaker 1: Bloomberg Audio Studios, podcasts, radio news, bokom Our Trains.
Speaker 2: I'm Joel Webber and I'm Eric Belchernas.
Speaker 1: Happy New Year, Happy New Year, buddy, twenty twenty six.
Speaker 1: We're here. We made it, but we're recording this in
Speaker 1: advance so that you know we can sleep in on
Speaker 1: the holiday.
Speaker 2: Yeah, that was that was me pretending to be in
Speaker 2: the future.
Speaker 1: Yes, good job, thank you. So as we looked at
Speaker 1: twenty twenty six, as always when we do this on Trillions,
Speaker 1: we try and enter the new year with some spotlights
Speaker 1: on some tickers.
Speaker 2: Yeah.
Speaker 3: This is really born out of me doing the Money Show,
Speaker 3: which is a direct to retail conference that they have
Speaker 3: like in Florida, and it's a lot of like investors
Speaker 3: who are just looking for cool investments. And I used
Speaker 3: to do my like like top down Trends PowerPoint and
Speaker 3: I could tell like they weren't that into it, but
Speaker 3: every time I brought up a ticker, they come up
Speaker 3: after what was the ticker?
Speaker 1: You said?
Speaker 2: So I realized they just like tickers.
Speaker 3: So I did any show presentation called like twenty three
Speaker 3: ets for twenty twenty three.
Speaker 2: I was like, this should be a note.
Speaker 3: So you started writing that every year, and I got
Speaker 3: really good feedback on it. People just like tickers stroll
Speaker 3: at the end of the day, you can tell them
Speaker 3: all the cool trends. But this is like the Silicon
Speaker 3: Valley of the investing world, and so we know all
Speaker 3: the gadgets and here we are going to unearth some
Speaker 3: stuff that we find interesting and people like that.
Speaker 2: But twenty two.
Speaker 1: Twenty six for twenty six seem like maybe a little
Speaker 1: too much, So we're gonna pair it back just a
Speaker 1: little bit and do sixteen ish for twenty six.
Speaker 3: Yeah, we just we just don't have enough time to
Speaker 3: do all of them. Sixteen seems like a good number.
Speaker 3: But if you want to see the full list, happy
Speaker 3: to just email me and I'll send you the report
Speaker 3: we did on it.
Speaker 1: Also joining us Athanasio, Sarah Vegas, and James Seffert ETF
Speaker 1: analysts with Bloomberg Intelligence, this time on trillions tickers for
Speaker 1: twenty twenty six. Athanasios, James, welcome back to Trillions.
Speaker 4: Thanks for having me, glad to be back.
Speaker 1: Okay, who's gonna go first. We're gonna go kind of
Speaker 1: round robin. Eric, you want to kick us.
Speaker 2: Off, I will because I have six they have five.
Speaker 1: Okay, well, so you're gonna give one and then we'll
Speaker 1: transition to the other guys. Yep, okay.
Speaker 3: My first one is bank the I Shares Flexible Income
Speaker 3: ETF E I n K no B I n C
Speaker 3: B I n Z yep I guess for income I
Speaker 3: n C. Here's what's interesting. So this is the fund
Speaker 3: managed by Rick Reader, who is actually one of the
Speaker 3: people in consideration to be the new FED chair. So
Speaker 3: he's a pretty big deal. He got into the ETF game.
Speaker 3: A lot of big names got in in the past
Speaker 3: couple of years. And this ETF is amazing. It's got
Speaker 3: fifteen billion. That means it's the fastest growing active etf ever,
Speaker 3: faster than JEFPI, faster than JPST, which are the kings
Speaker 3: of each of those categories. So this is a juggernaut.
Speaker 3: It's forty BIPs and I looked at the returns. It's
Speaker 3: beating the aggregate bond index pretty easily with half the volatility.
Speaker 3: That means what I'm not it's real. That's why it's
Speaker 3: got all the money. Honestly, that's kind of the holy
Speaker 3: grail to be able to outperform with less vol And
Speaker 3: how long has it been around since May of twenty
Speaker 3: twenty three. So I'm watching it because a it's it's
Speaker 3: the fastest growing active ETF right now. It's going to
Speaker 3: challenge JPST for the king of active bond and it
Speaker 3: may even challenge someday JEPPI. And the other thing that
Speaker 3: is interesting about this is when we look at mutual
Speaker 3: funds flows this year, the equity side want over one
Speaker 3: trillion out flows, like nobody wants stock pickers anymore. However,
Speaker 3: on the fixed income side, active bond mutual funds have
Speaker 3: taken in money.
Speaker 2: So I think for.
Speaker 3: People out there when they think of their bond allocation,
Speaker 3: like the AG is a bit dull full of treasuries,
Speaker 3: people really are much more open to active So I
Speaker 3: think that's why this is really checking a lot of
Speaker 3: boxes for people. And at forty BIPs it feels like
Speaker 3: a good deal.
Speaker 2: So look out for this thing.
Speaker 3: This thing is you know, total juggernaut and one that
Speaker 3: I will watch the next year.
Speaker 1: Anoxious.
Speaker 4: Well, I think that's a good pick, and I think,
Speaker 4: like you said, it gives a lot of hope to
Speaker 4: active right to active bonds. If you can outperform do
Speaker 4: with lower vowel, you have a chance, So I guess
Speaker 4: you know that's a good pick.
Speaker 1: Nice name drop for twenty twenty six too. Okay, that's Anosios.
Speaker 4: In your next let's go, I'll start with L R
Speaker 4: and D. So it basically just stands for a large
Speaker 4: cap R and D spending. So this is from New
Speaker 4: York Life. You know, we talk a lot about dividends,
Speaker 4: we talk a lot about buybacks, but we don't talk
Speaker 4: about companies that are investing in R and D or
Speaker 4: in like Capex and things like that. And we've actually
Speaker 4: brought this idea up in the past about well what
Speaker 4: about companies that are investing in things? In twenty twenty five,
Speaker 4: it's actually beating the S and P five hundred. And
Speaker 4: the reason this I picked this is it came out
Speaker 4: of some research from our quant analyst, Chris Kane, and
Speaker 4: he was saying that companies that were actually spending more
Speaker 4: in R and D were beating those that weren't. And actually,
Speaker 4: this product is really cheap. It's twenty fourteen bases points,
Speaker 4: it's pretty launch in twenty twenty two. It doesn't have
Speaker 4: a whole lot of assets, but I think it's very unique.
Speaker 4: There's no other product out there that is actually investing
Speaker 4: in companies that are spending money on R and D.
Speaker 4: So that's something that I'm looking at for next year.
Speaker 1: So is it waited by what the spind is?
Speaker 4: It is, so you'll get and it's also market cap weighted,
Speaker 4: so you do get some Nvidia, some Apple in there,
Speaker 4: but then you get some unique names like a lot
Speaker 4: of healthcare. You get Philip Morris. That's in there too, right,
Speaker 4: regardless of how you feel about cigarettes and vaping. But
Speaker 4: you do get some non obvious names in there, so
Speaker 4: it's pretty diversified, is pretty concentrated.
Speaker 1: Interesting, all right, James.
Speaker 5: I love the R and D play. I think it's great, fascinating.
Speaker 3: Yeah, well, thedn't they tried Capex, right, that was one
Speaker 3: they did, and I think it liquidated, but maybe this
Speaker 3: won't work.
Speaker 4: It did, but actually Capex performs really well over like
Speaker 4: buybacks and total shareholder yields, so I think it's something
Speaker 4: that kind of gets overlooked.
Speaker 1: All right, James, take us around the around the circle.
Speaker 1: What's your first pick? All right?
Speaker 6: My pick is VXUS, which is the Vanguard Total International
Speaker 6: Stock Index Fund, which, yeah, sounds pretty boring, but I
Speaker 6: mean in twenty twenty five it outperformed the S and
Speaker 6: P five hundred by about thirteen percent A few years ago.
Speaker 3: I picked VXUS. Yeah, and I should have picked it
Speaker 3: last year. I was gonna say, I'm getting deja vu, Like,
Speaker 3: don't you pick this every year?
Speaker 5: No, I didn't pick it. I haven't been.
Speaker 3: This is like the word fetch from mean Girls. He's
Speaker 3: trying to make international happen.
Speaker 1: It hap.
Speaker 2: I mean it did happen, to be fair, but it happened.
Speaker 2: I mean, we're gonna find probably not gonna happen again.
Speaker 2: We're gonna find you one one year is like all
Speaker 2: you get for like ten years. We'll see.
Speaker 6: I mean there's I mean, it's had a record inflow year.
Speaker 6: It's taken in about seventeen seventeen billion. Right. The question
Speaker 6: is are people one going to rebalance out of this
Speaker 6: thing and going back into their domestic if because it's
Speaker 6: outperformed domestic, or are they going to pile in because
Speaker 6: they think it's going to outperform going forward. I mean, valuation,
Speaker 6: If you look at valuations, international stocks look pretty appetizing.
Speaker 6: But then again, we have the best companies in the
Speaker 6: world here in the US. So it's a hard debate
Speaker 6: to have, so, yeah, I'm just watching this and the
Speaker 6: other thing I would point out, which this is going
Speaker 6: to give you real djavu. This thing had launched in
Speaker 6: twenty eleven, it's had like four days of outflows. Like
Speaker 6: in total, it's had four days where it had an outflow.
Speaker 6: So this thing just pulls in money hand over fist
Speaker 6: and rain or shine for the most part. It'll be
Speaker 6: interesting to see if that flips a little bit after
Speaker 6: this outperformance.
Speaker 1: Now, Eric, howo'd Jack Bogo feel about that product?
Speaker 3: He would say, you don't need it? And he started it.
Speaker 3: That's what's so great about Bogel. He would he actually
Speaker 3: dumped on his own creations because over time as he
Speaker 3: got older, he just he didn't see the need for it.
Speaker 3: He you know, he would he was pretty savage, and
Speaker 3: he would take shots at some of these foreign countries
Speaker 3: for having no like not a lot of work ethic.
Speaker 3: France in particular. He's like, they tried to pass a
Speaker 3: law that you can only work thirty five hours.
Speaker 2: What's the point investing there? You know?
Speaker 3: Like, and he also thought that with the global nature
Speaker 3: of this economy, that the US would reflect a lot
Speaker 3: of the overseas markets. Anyway, and you also have all
Speaker 3: your investments in the same currency, so why take currency
Speaker 3: risk one, which is what you do with international investing,
Speaker 3: So he had those reasons. I will say this, if
Speaker 3: you're an investor who can't stay in volatility, like if
Speaker 3: you can't stand in the US having two off years,
Speaker 3: then you might want international because that will go up
Speaker 3: sometimes when US is like struggling, and that will lower
Speaker 3: your overall if that makes you feel better, like, hey,
Speaker 3: at least this part of my portfolio is up because
Speaker 3: this one's down, you may need international. So for behaviorally,
Speaker 3: international can help advisors calm clients down because it diversifies. However,
Speaker 3: Bogel did not need behavioral help. He was going to
Speaker 3: buy the S and P and wait fifty years, and
Speaker 3: you were going to get him out of there with
Speaker 3: like a crowbar. If you're that committed, like a Buffet
Speaker 3: or Bogel, and you're like, I don't care if it's
Speaker 3: down three years in a row the US rules, I'm
Speaker 3: sticking to it, then you don't need international probably, So
Speaker 3: I think it depends on your own behavior that that
Speaker 3: would be my take on it.
Speaker 2: But I'm with you.
Speaker 3: This year International outperformed and we all have to acknowledge that.
Speaker 1: I think, well, it took him a second to get there,
Speaker 1: but yeah, yeah, there was a yeah.
Speaker 3: Well but ironically you picked it three years ago and
Speaker 3: it didn't and now you're picking it this year when
Speaker 3: it probably won't.
Speaker 6: So well, I'm picking it more because it's interesting to see.
Speaker 6: Is it going to are we going to see it continue?
Speaker 6: And what are flows going to do?
Speaker 5: Are people gonna bet on it continuing or not?
Speaker 1: Real question won't be if he's back next year. Okay,
Speaker 1: let's go to round two. Eric.
Speaker 3: Okay, I'm actually sticking international, believe it or not.
Speaker 2: But it's not exactly. It's not this like.
Speaker 5: What is this it's time for international thing?
Speaker 2: It's not that.
Speaker 3: Okay, It's not like that columnist telling me, oh, you
Speaker 3: have to sell America thing. Okay, this is an ETF
Speaker 3: that you guys will not know.
Speaker 2: Watch this.
Speaker 3: These guys like live and eat and breathe this stuff.
Speaker 3: Have you guys even heard of OTGL?
Speaker 5: No? No, no, what is it?
Speaker 2: Okay, it's the OTG.
Speaker 3: I haven't heard of that either, Latin America ETF And
Speaker 3: the reason that I even found it, I didn't even
Speaker 3: know it existed. But there's been a couple elections in
Speaker 3: South America that have gone far right, which usually means
Speaker 3: pro business, which usually means big returns. You start with Argentina,
Speaker 3: obviously that thing's up like two hundred percent, and then
Speaker 3: Chile just went to the right, and that was anticipating that,
Speaker 3: and that's up like sixty percent on that anticipation. Now
Speaker 3: Brazil they might have somebody elected who's on the right
Speaker 3: side in next year, and that's already got that thing
Speaker 3: starting to move. So here's a continent that's going from
Speaker 3: like socialism to capitalism pretty quickly. And so if you
Speaker 3: wanted to try to play that or at least own it,
Speaker 3: you don't own a lot in your international Latin America
Speaker 3: is pretty tiny waiting.
Speaker 1: So it's in it.
Speaker 3: The reason I found it is because I was looking
Speaker 3: for ETFs that had both Argentina and Chile. There's not many.
Speaker 3: Argentina is tough, it's not in a lot of equitytfs.
Speaker 3: This one has two percent to Argentina, eleven percent to Chile,
Speaker 3: and forty three percent in Brazil. So it really does
Speaker 3: a good job of getting you all of Latin America,
Speaker 3: whereas the I Shares one doesn't have a lot of that,
Speaker 3: especially it does no Argentina really, So anyway, this is
Speaker 3: one that captures I think the best of this sort
Speaker 3: of shift to more pro business leaders in that continent.
Speaker 3: And it's for that reason that I'm watching it, because
Speaker 3: I'm telling you, traders like nothing more, especially emerging markets,
Speaker 3: than to see an election shift that way. I've seen
Speaker 3: it my whole career. So it looks like it's spreading
Speaker 3: across the continent, and if it does, I would stand
Speaker 3: I would think this would benefit from that. That said,
Speaker 3: this isn't the one I'm gonna watch for like volume
Speaker 3: and flows. The other ones will probably see more of
Speaker 3: the single ticker ones, but this one captures the all
Speaker 3: those countries the best.
Speaker 2: But this is why we do ETFs.
Speaker 3: There is always an ETF out there that gets you
Speaker 3: the closest to something, and sometimes it's not the one
Speaker 3: you think, mister.
Speaker 1: International over here.
Speaker 4: I mean, I still hate International, but if I had
Speaker 4: to pick, I think South America. I like these countries
Speaker 4: that are going through massive shifts versus like Europe, so
Speaker 4: I probably would be more inclined to buy like not
Speaker 4: America over something like Europe.
Speaker 3: And this is not like saying sell America and like
Speaker 3: rotate to international like this guy. It's basically saying it's
Speaker 3: a little hot sauce. This is like, oh, maybe sell
Speaker 3: your AI E t F and put this one on.
Speaker 3: This is like a hot sauce bucket.
Speaker 1: Play okay, Ethan your what's your second? Okay?
Speaker 4: I got a question. Have you heard of this company?
Speaker 4: You pexy? Don't know what they do?
Speaker 1: Run twos where you trying and stump each other?
Speaker 4: Yeah, because I don't know either. But there's a two
Speaker 4: x ETF on this company and it's only got one
Speaker 4: hundred and thirty six million dollar market cap.
Speaker 1: What the letters in the ticker.
Speaker 4: So the ticker is p XIU, which is tx TX
Speaker 4: you PIXI. I think this is the year something blows up.
Speaker 4: I think we got a little crazy with these two
Speaker 4: X levered products. We've gone really far down the market cap.
Speaker 4: Like I mentioned this one, he got one hundred and
Speaker 4: thirty six million dollar market cap. Especially like a small
Speaker 4: slash microcap company, we have a two x leveraged version
Speaker 4: of it. I don't know if this might be the
Speaker 4: one that actually like liquidates in a single day, but
Speaker 4: I think we're going to have an event this year
Speaker 4: on one of these single stock ones. So I'm just
Speaker 4: throwing this ticker out to keep an eye on its
Speaker 4: more like category. Yeah, exactly, it is fine. Hey, stuff
Speaker 4: blows up. You know, we had XIV a couple of
Speaker 4: years ago. I think we're due for one.
Speaker 1: Maybe just don't want to be there when it happens.
Speaker 4: Yeah. Yeah, it might not have any assets in it,
Speaker 4: but I think it just might be symbolic of just
Speaker 4: how far we've pushed it into some of these products.
Speaker 3: I mean, the vall is two hundred and fifteen percent,
Speaker 3: which is a lot. That's like, what is that like
Speaker 3: fifteen times the SMP. There's some a little more volatile,
Speaker 3: but the stock would only need to move obviously what
Speaker 3: fifty percent, But that vall indicates that fifty percent isn't
Speaker 3: that outrageous? What you need is if one of these
Speaker 3: little quantum stocks like has A goes bust, then the
Speaker 3: two X will obviously terminate because it will go down
Speaker 3: more than fifty percent.
Speaker 1: In a day.
Speaker 6: I mean the other part is like the sec stop
Speaker 6: those three X and five X number one, I think, yeah,
Speaker 6: but full endorse. I think we're going to see some
Speaker 6: sort of liquidation of that this year.
Speaker 2: Yeah, but one or two a year, no big deal.
Speaker 2: If you had three x, you'd have them every other week.
Speaker 2: So yeah, we can handle one once in a while, exactly.
Speaker 1: All right, James, you got it one that's gonna stump.
Speaker 6: Them, Yes, actually, but it's it's more a category one.
Speaker 6: It's I think it has the lowest assets.
Speaker 5: Of anything that anyone's gonna pick here today TXBC ever
Speaker 5: hear of it?
Speaker 6: No, all right, so twenty one shares foot see crypto
Speaker 6: ten x, BTC etshot.
Speaker 2: Oh he's discussed looking them over there. Ethen's the anti
Speaker 2: crypto gus the team. But it's good. We need that.
Speaker 3: Yeah, because just in case, like everything goes to hell,
Speaker 3: Athen will have been quarantined from all this.
Speaker 2: We definitely have the cryptovirus.
Speaker 6: So this is more just I think that these crypto
Speaker 6: index type products are really going to take off. I
Speaker 6: think there's gonna be a lot of band We have
Speaker 6: one from bitwise that has over a billion gray scalees
Speaker 6: one hashtecks coin shares, they all have them. There's a
Speaker 6: lot of been filed. I like this one because it's
Speaker 6: it gives you the crypto market cap without Bitcoin. A
Speaker 6: lot of people are ready probably have exposure to bitcoin.
Speaker 6: If you want to add more diversified exposure to crypto,
Speaker 6: this does it without doubling up on your bitcoin because
Speaker 6: in those other market cap oided ones, bitcoin seventy five
Speaker 6: eighty percent, So.
Speaker 1: It's crypto x bitcoin correct.
Speaker 6: And then and then I think longer term we're going
Speaker 6: to see like fundamental weighted stuff. Kai Wu friend of
Speaker 6: the show who park Line, he has SMAs where he
Speaker 6: does fundamental trading and waiting of these ald coin ETFs.
Speaker 6: I think a year from now we're going to see
Speaker 6: a lot of that. But I just think this whole
Speaker 6: category is going to be huge.
Speaker 2: Yeah, I'm with him.
Speaker 3: I think an index will be because who can pay
Speaker 3: attention all this stuff?
Speaker 2: You know?
Speaker 3: The question is if you already own bitcoin, do you
Speaker 3: use a big an index with bitcoin in it? That
Speaker 3: has to be worked out. But yeah, long term, I
Speaker 3: see some value here. Okay, Round three, Okay, I'm going
Speaker 3: to go with one that I might have picked this
Speaker 3: last year.
Speaker 2: I can't remember, but I was watching it all year. XOVR.
Speaker 3: This is uh the Public Privates Crossover ETF, which was
Speaker 3: a nobody ETF that did I think value stocks like
Speaker 3: nobody cared. It was an oblivion probably about to die,
Speaker 3: and it switched this category to add some private equity.
Speaker 3: You can add up to fifteen per cent of liquid
Speaker 3: investments in added SpaceX. Once it added SpaceX, it like
Speaker 3: immediately got three hundred million flows.
Speaker 2: Like it was like build it and they will come.
Speaker 3: And this was happening the same time the private credit
Speaker 3: ETFs launch, which really underwhelmed, and to me, it showed
Speaker 3: me that there was a huge unmet demand to get
Speaker 3: private equity in an ETF, not private credit. And then
Speaker 3: when SpaceX got root in the rumor to go IPO,
Speaker 3: it took in another three hundred million over the past
Speaker 3: couple weeks, and this again tells me that there is
Speaker 3: a huge demand out there.
Speaker 2: Now.
Speaker 3: I don't know why the ETF industry has filed so
Speaker 3: many private credit and heartland really no private equity. There's
Speaker 3: been a couple to try to do synthetic private equity
Speaker 3: with using public stocks, but not that. I just think
Speaker 3: they should really try to push the envelope with putting
Speaker 3: literal private equity in here, maybe not one hundred percent,
Speaker 3: but like the way priv did with putting more than
Speaker 3: fifty percent private credit. XOVR at seven hundred million again
Speaker 3: total ind I think it's a one man show. That's
Speaker 3: an enormous sign right there. So I think we're going
Speaker 3: to see a lot with this next year. And this
Speaker 3: ETF to me is like the guinea pig.
Speaker 1: If you're looking at IPOs for next year, SpaceX atop
Speaker 1: that list. Is this your preferred way to get exposure
Speaker 1: to that or is it more.
Speaker 3: Like ARC.
Speaker 2: Right now?
Speaker 3: Yes, because it owns it like it will definitely feel
Speaker 3: some of that. That said, there's also the IPO ETF,
Speaker 3: which would own SpaceX a couple of days after the IPO,
Speaker 3: so you have to like ask yourself, like when do
Speaker 3: you want it? But this gets it before, which is
Speaker 3: really cool, So I'd assume this would be the better play. Still,
Speaker 3: though it's only five to ten percent, I think right
Speaker 3: now that's not a ton, but that's enough to move
Speaker 3: the needle if SpaceX were to go, If if you
Speaker 3: were to get, like I don't know, an eighty percent return,
Speaker 3: that would definitely lift the returns of xovr.
Speaker 4: Athanasius, I love this ticker. This ETF is pending, but
Speaker 4: it's grift GRFT. It's from Tuttle. It's the Tuttle Capital
Speaker 4: Government Grift etf. So it does two things. Want it
Speaker 4: kind of I know, I know, but you know, you
Speaker 4: have to admire the opportunistic nature of the industry right
Speaker 4: sometimes to a fault. But they think this one could
Speaker 4: be really interesting. Obviously you've seen the government buying stake
Speaker 4: in companies right and promoting these companies. So it does
Speaker 4: two things. One it actually kind of follows insider not
Speaker 4: insider but trading of what politicians are doing. But it
Speaker 4: also is investing in companies that have political ties. So
Speaker 4: something like Intel is a perfect example. So would pick
Speaker 4: up these companies. The thing is they're gonna be really
Speaker 4: interesting companies to watch. I think if there's money being
Speaker 4: pumped into a lot of these companies, follow them. I
Speaker 4: think it could be an interesting strategy. You know, even Nance,
Speaker 4: the the kind of Nancy Pelosi one has done really
Speaker 4: well performance wise. It's got a couple hundred million in assets.
Speaker 4: It's actually like a pretty decent size. I think this
Speaker 4: one can probably have some similar success. I don't know
Speaker 4: if the expense ratio is because it's pending, but I
Speaker 4: think this is definitely one I want to watch for
Speaker 4: next year.
Speaker 2: I think that the cynicism alone is funny. And interest thing.
Speaker 1: Is it being ironic or is it actually like, well.
Speaker 3: There's been there a couple attempts to do like here
Speaker 3: and invest in these stocks that are democrat leaning or
Speaker 3: republic leaning. Those never took off. This is just like
Speaker 3: let's make money on the corruption, which I think is
Speaker 3: a more honest way to try to play this. There's
Speaker 3: also one that's coming out called the Roundhill USA Government
Speaker 3: Portfolio ETF, which was supposed to be called I think
Speaker 3: the White House Sovereign Wealth Fund, and it's it's basically
Speaker 3: trying to it's going to own all the stuff that
Speaker 3: the White House likes and buys, basically, so semiconductors, Bitcoin,
Speaker 3: stuff like that. So we're going to see some ETFs
Speaker 3: trying to ride the sort of you know, government connection
Speaker 3: with business and capitalism.
Speaker 6: James, all right, this is a ticker that both these
Speaker 6: guys know pretty well. I think this might have been
Speaker 6: selected in years past. But I'm picking box b O
Speaker 6: x X from Alpha Architect. It's the Alpha Architect one
Speaker 6: to three month box ETF. Basically, what it does is
Speaker 6: we we talk about a lot of those products that
Speaker 6: offer tons of yield. Right, they do things cover derivatives
Speaker 6: to offer tons of yield. This is almost like the inverse.
Speaker 6: It's taking the return stream of like your treasury bills
Speaker 6: and not actually distributing any income. So you get the
Speaker 6: same return stream as though you're getting income, but you
Speaker 6: don't have to pay it out. So if you hold
Speaker 6: it for longer than a year, all of a sudden,
Speaker 6: you're in the long term capital gains rate, which if
Speaker 6: your income is taxed at thirty five, thirty seven percent,
Speaker 6: even higher than that, and you can get it down
Speaker 6: to the fifteen percent range, whatever it may be, that's
Speaker 6: a huge tax savings. So there's two reasons I picked
Speaker 6: at one. It's fascinating because the FED, we don't know
Speaker 6: what's going to happen with the FEDNIXTU, we're gonna get
Speaker 6: new FED share, what are they can do the rates?
Speaker 6: Are people going to leave if the yields are down
Speaker 6: in treasuries? The other part of it is like this
Speaker 6: is kind of like it's like changing the way the
Speaker 6: tax structure is set up, and there's some people that
Speaker 6: have concerns around whether or not this should be allowed
Speaker 6: and is this something they're going to look into doing
Speaker 6: so I just think it's fascinating. This thing is taken
Speaker 6: in money hand or a fist. Every month, it takes
Speaker 6: in a couple hundred million dollars and it's almost a
Speaker 6: ten billion dollar product from an arguably in the issuer.
Speaker 6: So I think it's just a true success story.
Speaker 2: Highly creative.
Speaker 3: You know, you can be creative on all different ways
Speaker 3: in ETF LAN So there's a bunch of ETF's work
Speaker 3: and looking to innovate on taxes.
Speaker 2: Interesting though, what you said.
Speaker 3: The price return of this is fifteen percent, and so
Speaker 3: is the total return for SHV, which actually holds short
Speaker 3: term debt that doesn't have any price return. I mean
Speaker 3: it's basically zero. Fifteen percent is a total return, but
Speaker 3: that's all from income, so that is a huge swing.
Speaker 3: It's not like even a little And I can see
Speaker 3: why people like this. I mean, it's fairly, really creative,
Speaker 3: and really I think it almost kicked off a whole category.
Speaker 6: Yeah, I think it did kick off a whole category.
Speaker 6: We're gonna see more of this stuff.
Speaker 3: Okay, run four, Okay, I'm gonna go with buff b
Speaker 3: buh buff B.
Speaker 2: I love that ticker. By the way, there's also one buff.
Speaker 3: Buff but buff B is a laddered buffer, so a
Speaker 3: couple of weeks ago, my mom, who like rarely comes
Speaker 3: to me with ETF questions, He's like, I'm thinking of
Speaker 3: buying one of these buffery, but I want the ladder
Speaker 3: ones off to worry about it. So it's like, okay,
Speaker 3: if she's getting wind of this, you know, it's like
Speaker 3: you's got to be in Time magazine at this point
Speaker 3: or something like.
Speaker 2: That USA today.
Speaker 3: Like it's like, how popular are buffers that she even
Speaker 3: knows about it, right, and she's thinking, I don't want
Speaker 3: to worry about it. I'm like, then I looked. The
Speaker 3: ladder buffer from First Trust is the most popular buffer ETF.
Speaker 3: I get it. It's a little more costly, but it
Speaker 3: just does all the work of like having to go
Speaker 3: to the new ladder.
Speaker 1: So there's the new five picks and one pick from
Speaker 1: your mom.
Speaker 2: Yeah.
Speaker 3: Basically, well, because this is another reason I picked it
Speaker 3: is so a it's Innovator's ladder buffer that challenges BUFR,
Speaker 3: which is First Trust number one buffer ETF on the planet.
Speaker 2: But this one doesn't have nearly as much assets. This one.
Speaker 3: Basically, like BUFR is nine percent buffered, right, so that's
Speaker 3: how much the market would go down that it would
Speaker 3: protect you from. So anyway, these two products, the first
Speaker 3: trust is huge, this one not so huge. But guess
Speaker 3: who just bought innovator goal now Brian Lake runs Goldman.
Speaker 3: You saw what he did with JEPY and JPST, So
Speaker 3: if he's listening, I am almost challenging him. This thing
Speaker 3: probably should have ten times the assets given it does
Speaker 3: the same thing as BUFR pretty much and has a
Speaker 3: minuscule amount of the assets. An innovator put buffers on
Speaker 3: the map. So this is a product that I could
Speaker 3: see if it got you know, the Goldman firepower behind it,
Speaker 3: it could really take off, especially if you have people
Speaker 3: like my mom who want buffers but don't want to
Speaker 3: have to like put the new buffer in every year.
Speaker 1: Ethan run foth.
Speaker 4: Can I pick one that what you shouldn't do?
Speaker 1: Yeah?
Speaker 4: Okay, yeah, this one annoyed me from the second at launch.
Speaker 1: Just think about these to watch it's.
Speaker 3: Well, I mean, honestly, would you say more ETFs annoy
Speaker 3: you than don't?
Speaker 4: Probably?
Speaker 3: Yeah, yeah, he's the old man, the only clouds on
Speaker 3: the teams like, but it's good.
Speaker 4: This one's a peak clean, it's a PCL and it's
Speaker 4: the pictet cleaner plane at ETF And it's nothing against them,
Speaker 4: it's just about reading the room of the industry. And
Speaker 4: you've seen the tickers that we've mentioned. It's intense. This
Speaker 4: is a really competitive industry. You need to come either
Speaker 4: with some sort of really differentiated strategy or we look
Speaker 4: at most successful launches this year, a lot of them
Speaker 4: had their a lot of b YOB sorry b YOA
Speaker 4: just bring your own assets. This one is just a
Speaker 4: firm that I think is not really reading the TF industry.
Speaker 4: But it's not just about them. It's about if you're
Speaker 4: going to enter the industry, you need to have a plan.
Speaker 4: You know, this is seventy basis points, it's an ESG product,
Speaker 4: So not only is it expensive, it's a strategy that
Speaker 4: no one is really looking for. So this year is
Speaker 4: going to be interesting with share class potential. You're gonna
Speaker 4: have a lot of issue, a lot of asset managers
Speaker 4: trying to come into the industry. It's about, you know,
Speaker 4: you got to be aggressive, you got to be all in,
Speaker 4: and I think this is an example of not being
Speaker 4: all in. Honestly, I want to be surprised if this
Speaker 4: closes in a couple of years, but just sort of
Speaker 4: you know, Yeah, there's stuff that we're watching, but also
Speaker 4: there's kind of stuff that you should, you know, maybe
Speaker 4: not necessarily do.
Speaker 3: Also, they are coming from the European mutual fund world,
Speaker 3: and they are big in themes there. But European mutual
Speaker 3: funds is pretty cush. It's a cush lifestyle. This is
Speaker 3: the Deterredeme. It's interesting they skipped the ETF market in
Speaker 3: Europe and went right to the US, which is like,
Speaker 3: I mean, that's like a real crazy swing going from
Speaker 3: europe mutual funds to US ETFs seventy BIPs.
Speaker 2: The whole cleaner planet thing.
Speaker 3: Like remember like Gabelli tried that it's out of vogue,
Speaker 3: it'll be tough. You're right, this one is. I'd be
Speaker 3: surprised if it if it gets organic. I think it
Speaker 3: needs to get some BYO or something to get going.
Speaker 3: Not to say they won't have no successes, but this
Speaker 3: one in particular, I don't know.
Speaker 6: I don't see it, but James run for Yeah. I mean,
Speaker 6: one quick note I would say is like I don't understand.
Speaker 6: I'm with them, one hundred percent with them.
Speaker 1: I don't know.
Speaker 6: It just it's not they need an institution to come
Speaker 6: in and back them up. It doesn't make any sense.
Speaker 6: All right, I'm gonna pick one that I think you
Speaker 6: guys know it. You guys definitely do know it, Joe,
Speaker 6: you might not. So this is actually the fourth largest
Speaker 6: flow getter in twenty twenty five, and the ticker is SPY.
Speaker 1: M don't know it.
Speaker 5: It's basically SPI's Mini shares. It used to be. I
Speaker 5: think they had a different SPLG.
Speaker 2: I think SPLG.
Speaker 6: Yes ticker it's State Street Spider Portfolio S and P
Speaker 6: five hundred ETF. This thing has one hundred and one
Speaker 6: billion dollars. That is a massive product. It's done exceptionally well.
Speaker 6: The reason it's done exceptionally well is it charges two
Speaker 6: basis points to get exposure to the S and P
Speaker 6: five hundred, So it's cheaper than IVV. It's cheaper than VUU,
Speaker 6: the number one flow getter this this past year. So yeah,
Speaker 6: it's taken in thirty five billion. So I'm interested to
Speaker 6: see one. How are they going to do going forward?
Speaker 6: It seems to be ciphering assets off of SPY the
Speaker 6: legacy asset, the legacy product. And will Vanguard or I
Speaker 6: Shares decide maybe we should compete with this because these
Speaker 6: things are doing well.
Speaker 5: I guess Vanguard doesn't have to.
Speaker 6: They're the flow leader, but it'll be interesting to see
Speaker 6: how the shakes out.
Speaker 1: Is it actually showing up on a day to day
Speaker 1: basis in a way. That's like Spy is no longer
Speaker 1: the preferred trading vehicle, So Spy I don't think.
Speaker 6: I don't know if Spy will ever get dethroned as
Speaker 6: the preferred trading vehicle. This is like you want S
Speaker 6: and P five hundred, you want the cheapest exposure. Ironically,
Speaker 6: there were some products that offered free exposure to the
Speaker 6: S and P five hundred or a large cap. Specifically,
Speaker 6: it wasn't the SMP. Yeah, but people one want the
Speaker 6: S and P and two. I think there's people skeptical
Speaker 6: of free. So if you could get as close to
Speaker 6: free without actually getting there, you can probably get a
Speaker 6: lot of assets.
Speaker 5: And that's what I'm seeing here as far as I'm concerned.
Speaker 2: Yeah, no, it's true that one.
Speaker 3: You know, I had a section in my first book
Speaker 3: called the Power of one Dot dot dot basis point
Speaker 3: and because IVYV and VU went from like five to four,
Speaker 3: four to three, and it actually moved the needle. That's
Speaker 3: how cost obsessed people are, so yeah, that's a good one.
Speaker 3: It's already the twentieth biggest ETF and climbing I called
Speaker 3: the fourth Amigo because he used to call the other
Speaker 3: three the three Amigos. I don't know who the fourth
Speaker 3: amigo would be in that movie, but El Guapo.
Speaker 7: Anyway, it's sym Yeah, Okay.
Speaker 3: Round five, Okay, so I'm picking one. I like to
Speaker 3: pick one of a theme or sector that's just totally
Speaker 3: shot to hell, because you remember pick uranium that one
Speaker 3: year and I nailed that. This is the Advisor Shares
Speaker 3: pure Us Cannabis CTFMSOS. This thing is a billion dollars,
Speaker 3: but it's the most US centric of all of them,
Speaker 3: and it holds mss's, which are state operators. Anyway, anytime
Speaker 3: there's any like legislative win, this thing goes up. So
Speaker 3: there was recently where there was a rumor that they
Speaker 3: were going to reclassify it marijuana and Trump was going
Speaker 3: to sign this thing, and it went up fifty percent
Speaker 3: in a day. It's still down like over eighty percent.
Speaker 3: Even with that bump. That tells you that like this
Speaker 3: thing could run if it gets the right environment. And
Speaker 3: I talked to Ken shay Over in BI who covers
Speaker 3: this area, and basically there's like all these baby steps.
Speaker 3: It gets reclassified.
Speaker 2: That means the taxes are way better for these state operators.
Speaker 2: That's one win.
Speaker 3: But then it's like, Okay, well maybe it should be
Speaker 3: inside the banking system because if it's reclassified, then it's like, well,
Speaker 3: why aren't we even making this legal? He just thinks
Speaker 3: these this is like the road to federal legalization, which
Speaker 3: is the ultimate holy grail. And so there's a lot
Speaker 3: of potential here given that this stuff usually happens in
Speaker 3: a chain reaction. I'm not saying it will happen, but
Speaker 3: with how much it's beat up, its certainly any little
Speaker 3: news should move it. And MSOs I think is the
Speaker 3: one that captures the US market the best.
Speaker 2: So that's one I'll be watching interesting.
Speaker 1: Ethan.
Speaker 4: Yeah, that's a good pick, and I'm gonna go deep
Speaker 4: in the pull up a classic here from two thousand
Speaker 4: and six Housing ITV, which is the I Shares Home
Speaker 4: Construction ETF. Obviously, Housing comes up a lot. You know,
Speaker 4: it's been a big political platform everywhere. It didn't have
Speaker 4: a great year. It was pretty much flat this year
Speaker 4: versus s seventeen percent for the SMP. But I think
Speaker 4: it's a really interesting sentiment barometer. Obviously, we might have
Speaker 4: rates coming down next year, you have some regulatory support
Speaker 4: of a home builders. I think it's something that you know,
Speaker 4: and usually what happens with home builders it either has
Speaker 4: a really bad year or a really good year, and
Speaker 4: it's coming off of, like not of a great year.
Speaker 4: So I think it's just something to watch, obviously just
Speaker 4: being just because it's how much affordability is such a
Speaker 4: something that's talked about a lot recently, A political.
Speaker 3: Word that, by the way, that is a I like
Speaker 3: this because I believe that the new FED share one
Speaker 3: of their goals is to get rates lower so people
Speaker 3: start buying more houses, because that's been a problem for years.
Speaker 3: I mean, honestly, low rates are really good for housing.
Speaker 3: It seems like a no brainer, honestly.
Speaker 4: Yeah, And I think they want to help some of
Speaker 4: the home builders.
Speaker 2: Famous I don't see am I don't see a bair case.
Speaker 3: We don't make a T shirt that says that, because
Speaker 3: sometimes we're like we get all hot about something. We're like,
Speaker 3: I don't see a bare case, and it's like that's
Speaker 3: when you know you got to like be worried.
Speaker 1: Not not that, James, your final pick, all right, my
Speaker 1: final pick.
Speaker 6: At our annual conference a few weeks back, erica A
Speaker 6: presentation is this as good as it gets. And I
Speaker 6: think that's something that people should be worried about. And
Speaker 6: a lot of times what we see with these alternative
Speaker 6: ETFs is people pile in like after they should have
Speaker 6: already been in them. So the one I'm picking is
Speaker 6: the IMDBI Managed Future Strategy ETF DBMF, and it's basically
Speaker 6: managed future strategy.
Speaker 5: What they do is it's more tactical.
Speaker 6: It's kind of like CTA Trading, not exactly so what
Speaker 6: they had a stellar year in twenty twenty two. There
Speaker 6: it's now a two billion dollar product. But honestly, if
Speaker 6: you want to have this as a diversifier in your portfolio,
Speaker 6: you should have it before you know, you know what
Speaker 6: hits the fan. So if you're looking at this will
Speaker 6: be interesting to see how this product does. And I
Speaker 6: also like I'm gonna throw out another tick or a
Speaker 6: bonus ticker RSST, which is a return stacked version which
Speaker 6: will basically, instead of having to sell your S and
Speaker 6: P five hundred product, you can add this on and
Speaker 6: will give you kind of leverage exposure to this managed
Speaker 6: future strategy alongside the S and P five hundred.
Speaker 5: I just think some sort of all exposure.
Speaker 6: If you're trying to have a diversified portfolio and you
Speaker 6: don't want just sm P five hundred, like Eric or
Speaker 6: Jack Bogel, this might be a good idea to have
Speaker 6: so much to unpack.
Speaker 1: There that we're, uh, we're gonna let it ride. What
Speaker 1: is dB MF home.
Speaker 6: So it goes across futures products, So it could be rates,
Speaker 6: it could be equities, it could be commodities, and basically
Speaker 6: it should have an uncorrelated exposure to the S and
Speaker 6: B five hundred or the broad equity markets.
Speaker 3: For the most part, when everything's awful, this thing will
Speaker 3: do really well. In twenty twenty two, this thing had
Speaker 3: a billion dollars because it generally goes up.
Speaker 2: It has short positions, so.
Speaker 3: DBMF it won't go up a ton, but relative to
Speaker 3: everything else in the crapper, it'll be up pop probably,
Speaker 3: and so that's when alts will finally get their day
Speaker 3: in the sun.
Speaker 2: But it's rare.
Speaker 3: The equities are so good that these tickers just like
Speaker 3: they have a year now and then.
Speaker 2: But I see what you mean.
Speaker 3: This is if you if you're like one of these,
Speaker 3: like something's gonna go wrong, that one would be a
Speaker 3: good one to look at.
Speaker 1: All, right, Eric, your final one.
Speaker 3: This is going to close. This is a good finale.
Speaker 3: I thought about how to close this.
Speaker 4: If it's crypto, I'm just gonna it's not.
Speaker 3: But it's equally annoying to you because if this ETF
Speaker 3: is a hit, I think he will retire from the industry.
Speaker 3: He's always says that he's like, because always is it,
Speaker 3: mister Beest follows from ETF, I'm retiring.
Speaker 2: This is close to that.
Speaker 3: Okay, ufod this is the tuttle Capital UFO disclosure AI
Speaker 3: powered ETF. Okay, what does this do? Okay, I'm gonna
Speaker 3: read straight from the perspectus here. That hasn't launched yet,
Speaker 3: but it will probably twenty twenty six or Q one.
Speaker 3: It has a basket of companies that the advisor believes
Speaker 3: have potential exposure to advanced or reverse engineered alien technology,
Speaker 3: spurred by government disclosures about UFOs and alleged advanced technology.
Speaker 3: So basically, if you look at polymarket, there's all these
Speaker 3: odds going up that the Trump Administration's gonna release information
Speaker 3: on UFOs very soon, and this is going to take
Speaker 3: that information that they got from aliens and it's gonna say,
Speaker 3: we're gonna buy the companies that take that tech and
Speaker 3: like build stuff here with the alien tech. So it's
Speaker 3: an alien tech tech etf okay, and it uses AI
Speaker 3: to pick the stocks. So it's like, I mean, honestly,
Speaker 3: if this thing is over a billion dollars this time
Speaker 3: next year, I think I think that this will be
Speaker 3: curtains for Ethan oh Man.
Speaker 4: But this is such an Eric pick.
Speaker 3: I just think this is like that, this is this
Speaker 3: is I always say, the tent keeps expanding. This is
Speaker 3: like pushing this head far out on one wing of
Speaker 3: the tent.
Speaker 1: I don't know even how to respond to that.
Speaker 6: I mean, there is a lot of rumbling about Congress.
Speaker 6: They're doing a bunch of stuff, like trying to figure
Speaker 6: out what's going on. But these you know, aircraft of
Speaker 6: unknown origins, sof.
Speaker 1: So you can invest in anything. So what has to
Speaker 1: happen for this to launch?
Speaker 3: I mean, it's only equity. So really, Matt just has
Speaker 3: to Matt Tuttle has to explain the prospectives.
Speaker 2: Here's why I picked them.
Speaker 3: So it could launch even if there isn't any disclosure,
Speaker 3: like it can just say, you know, it can figure
Speaker 3: it out. So I think that it will launch regardless.
Speaker 3: But if if polymarket is onto something, the odds spike
Speaker 3: because I thought someone in the Trump administration was actually
Speaker 3: buying the about whether Trump will release something in twenty
Speaker 3: twenty five. We'll see if that worked out. But basically
Speaker 3: it's the information coming out that the tech companies will
Speaker 3: then use. Now I'm going to tell you right now,
Speaker 3: I actually.
Speaker 2: Don't think there's anything such thing as aliens like I don't.
Speaker 3: I just don't think it exists. That doesn't mean the
Speaker 3: ETF shouldn't exist. I'm a very free market capitalist, but
Speaker 3: I just think it's interesting that the thematic area in particular,
Speaker 3: you know, this is really pushing the envelope. I remember
Speaker 3: when people mocked. I remember tweeting out the filing for
Speaker 3: the video game ETF, and I remember everyone was like
Speaker 3: dumping on it, like oh, this is the top and
Speaker 3: they were just crapping on it. That's pretty normal sounding now,
Speaker 3: like so we would say today's sattire is tomorrow's ETF,
Speaker 3: and this is an example.
Speaker 1: Welcome to twenty six.
Speaker 2: Now one real quick thing. This is a fun this
Speaker 2: is a really interesting notjel.
Speaker 3: Matt Tuttle may not actually launch this. He may actually
Speaker 3: be on his own island somewhere because he has the
Speaker 3: ticker SPCX for this back etf he launched, he may
Speaker 3: sell that to Elon for SpaceX, the way Matt will
Speaker 3: Hershey sold Meta to Mark Zuckerberg for an unders allegedly allegedly,
Speaker 3: And so if Matt Tuttle quits the business randomly, he
Speaker 3: might quit before this even launches if he gets enough
Speaker 3: pyday from Elon.
Speaker 2: You heard it here first.
Speaker 1: All plenty to watch in twenty twenty six. Athanasios James,
Speaker 1: thanks so much for joining us on Trillions. Thanks for
Speaker 1: having me Yeah, thanks for having me on. Thanks for
Speaker 1: listening to Trillions. Until next time. You can find us
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Speaker 1: produced by Magnus Hendrickson and Ryan Kessler. Amy Keane is
Speaker 1: our executive producer. Sage Bomman is ahead of Bloomberg Podcast Bye,