You are viewing the chat in desktop mode. Click here to switch to mobile view.
X
ETF.com Live!
powered byJotCast
Prev Page View Full Chat Next Page
Dave Nadig
Surprised because -- its a few years old, its not enormous (660 million), and it's actively managed.
Now there's a pretty good reason why -- it's up 66% over the last year!
1:20
So clearly, the folks voting think that having that kind of performance validation of an active strategy is worth singling out.
FWIW, I think it's an interesting take on a tech fund, because it really fishes from a lot of ponds - Tesla, Twitter, Biotech, etc.
Marty C.
1:21
How meaningful is the MSCI ESG scores in your fund pages? How can a fund like CXSE and MCHI have almost identical ESG scores?
Dave Nadig
1:21
Well, meaningful is relative.  I was actually just on a panel today with Linda Zhang from Purview who made an interesting case
1:22
that we're used to thinking about a two dimensional frontier - risk/return, and that we're headed towards a 3D, surface based frontier, where the third dimension is some measurement of impact or "ESGness"
1:23
It's obviously a pretty individual point of view, but the evidence is mounting that there are real risk/return benefits to considering the ESG side of things as well.
As for how you can end up with funds so close - well, the MSCI overall score takes into account a huge number of factors, so you can get a "good" score in a lot of ways (or a bad one).
1:24
but seeing two china ETFs have similar scores isn't hugely surprising, even though they have such different approaches.
in the MSCI methodology, governance and regulatory environmental issues can push things a lot, which is why you see so many EU country funds (like Sweden, Portugal) WAY at the top of the rankings
1:25
So it's worth looking at all the different angles on that ESG tab in the screener to try and tease out a bit of the "why"
Ben
1:25
Would it make sense for a large active mgr (TROW, BEN) to acquire an ETF firm?
Dave Nadig
1:26
Well yes and no.  We've seen plenty of these kinds of acquisitions already - Oppenheimer buying RevenueShares, etc..
But in some sense, if your big enough (Fidelity) you can afford to just go it alone.
An acquisition probably makes the most sense for a mid-tier traditional manager, because they can benefit from the jumpstart on both the intellectual capital side, and the infrastructure side.
Dan
1:26
What do you make of these AI-powered ETFs popping up?
Dave Nadig
1:27
Seems like a pretty logical progression from Smart Beta honestly.  If the "dumbest" smart beta is just identifying a factor, then it strikes me that the "smartest" smart beta is just algos that re-invent factor investing in real time, and thats basically what many of these approaches are doing.
1:28
I think calling them "AI" is a bit of a gimmick - they're really just a different approach to quantitative investing.  I think its cool that some of them use things like text-processing to read headlines and all that jazz
but hedge funds have been poking at that bear for a decade -- some successfully, some not.
1:29
So I think its fun, but I'm always skeptical.
Michael T. Kennedy
1:29
How is First Trust so good at distribution? You rarely see their name or logo anywhere, but they keep killing it with flows...
Dave Nadig
1:30
Well, while they may not be a household name to everyone, they're hardly an unknown.  They've been managing money for about 25 years, and actually launched a TON of products along the way.
Having a very large product line means, among other things, that SOMETHING is always performing well.
1:31
Combine that with a really traditional, shoe-leather strategy (folks pounding the pavement, taking meetings, talking strategies, day after day) and its worked for them.
in other words: performance plus hand-to-hand combat is a good combination, in almost any market.
1:32
I don't think it's much more complicated than that.  It helps that they have some wicked smart people on staff that write well, and have developed a following from an economics perspective.
That gives advisors a reason to take the meetings.
Iphegenia Doubtfire
1:32
Is there a way for investors to play the trade war with ETFs?
Dave Nadig
1:32
I'm always a bit skeptical of "Can I play X with an ETF" questions.
1:33
THe short answer is "of course" ... it just depends on how active you want to be.
1:34
you COULD, for instance, short soybeans (SOYB) and go long U.S. materials companies or something, but I always worry that by the time the average investor is researching the ETFs for a given premise like this, much of the price is probably baked in.
there are hedge funds out there jumping on EVERY headline, and that's part of why we see the kind of swings we've been seeing in the market in reaction to every bit of political posturing.
1:35
It strikes me as a pretty dangerous game to play -- thinking as an investor you can be smarter than the market pricing that stuff in moment by moment.
MaryJane
1:35
Canada has been leading the charge with the cannabis industry.  Do you see the US and specifically US ETFs catching up?
Dave Nadig
1:35
Clever name MaryJane (grin).
1:36
Actually its not just Cannabis -- I see Canada as a leading indicator on how things happen in U.S. financial services in a lot of areas.  I mean, Vanguard "tested" their smart beta funds in Canada before they launched them here, and so on.
1:37
Do I see a pure-play U.S. cannabis ETF catching on (other than the one we have)?  It seems SUPER niche to me.  That doesn't mean it cant get some traction
After all, we have lots of thematic ETFs that get their moments in the sun, like HACK,
Connecting…