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Emily
3:12
Can you please explain the creation/redemption process for Precidian's new non-transparent active ETFs?  Do the APs just deposit a bunch a securities in the trust and hope that the "trusted agents" are creating/redeeming efficiently on their behalf?  At some point, wouldn't the APs know which securities were being moved in or out of the bind-trust? Also, it seems like a lot of market making doesn't involve actual creations/redemptions, but instead hedging with correlated securities.  Would this be possible for these funds? Thank you!
Dave Nadig
3:13
Whoo boy.  Big question.  But in short:  Instead of the AP getting a list of securities from the fund, a new entity - the blind trust and it's representative - gets that list. and only they get it.
and they're the ones who do the buying and selling of those underlyign securities.
3:14
so you can think of the AP in this case as just making a cash transaction with the blind trust, who then goes out and does the real work.
the AP has to still manage some sort of hedge, which is why there's now this VIIV (Verified Intraday Indicative Value) so they can build their own tracking model against it.
And every 90 days, they get the full view, and can tweak their model.
3:15
Whether this all actually works as intended? Honestly, we have to wait till something launches.
But I'm optimistic the plumbing holds ...
J. Hayden
3:15
What’s the ETF Virtual Summit?
Dave Nadig
3:15
Wrong website!  LoL.  That's Tom Lydon/ETF Trends set of 4 webinars they ran today.  Its a fun event, but its over till next year!
Jana Marcus
3:16
Don’t think this is a specific asset class, but how have solar ETFs been doing lately?
Dave Nadig
3:16
Gosh I havent looked in ages, but did just now, with TAN:
3:17
Sort of looking like the market, honestly, But with a longer bad run in 2018
Same Christmas Eve bottom as everything else.
Tough to love solar in this political environment though.  The combo of tarrifs and general hostility the admin seems to have towards alternative energy is a hard pill to swallow as an investor.
Ben Frankken
3:17
Would inflation increasing decrease volatility?
Dave Nadig
3:18
Now thats an Econ 101 question that no professor will touch.  Grin.
3:19
In all seriousness, the conventional wisdom is that inflation and equity vol are somewhat correlated.  In fact the "vol spikes" weve seen in the last few years often get reported as a reaction to "inflation fears" -- not that any actual inflation has shown up much.
So if we did have sustained inflation (which I don't see) I suspect we'd have normal vol a bit higher than here, but honestly, for a lot of these macro factors, I feel like were in some pretty untested territory.
3:20
the global QE/QT cycle really throws a lot of textbooks out the window.
Denise Rich
3:20
I understand that LIBOR’s going away in 2 years. Was that the plan since its inception, and, what’s going to replace it?
Dave Nadig
3:20
Definitely not the plan from inception.  This is a specific reaction tot he LIBOR scandal from a few years ago.
3:21
Its being replaced by the "Secure Overnight Financing Rate" or SOFR, which is a much less interesting acronym.
The idea is to create something more transparent and replicable to base all these financial instruments on, which makes sense
3:22
I believe (but could TOTALLY be wrong off the top of my head) that the NY Fed is going to calculate SOFR, or at least, they built the math for it.
Sy Berghe
3:22
Since the SEC is cracking down on ETF names that could “mislead investors,” why wouldn’t that have been something they did some time ago? Is this something new  that issuers have started doing?
Dave Nadig
3:23
The SEC has always looked at naming conventions, but they've rarely acted.  As for why they're acting now: my suspicion is this:
ETFs are "bought" not "sold" really.  Certainly individual investors aren't getting visits from wholesalers.
3:24
And thus, the ticker and the fund name matter substantially more than they do than they do for something like, Growth Fund of America.
Because ETFs are at least at the face of the coal mine, transnational, where mutual funds are much less so.
So I think that's put some more focus on naming accurately.
Mostly, I think they are wary of blockchain, period, and that was the thin end of the wedge.
Tarek
3:25
BRICS were all the news for some time, but we haven’t heard much about them lately. What’s changed?
Dave Nadig
3:25
BRICS were the early entry point for emerging market exposure.
When the less developed EM countries were harder to access, BRICS was almost a kind of "liquidity cheat" to get the economic exposure without the operational risk.
3:26
The operational risk is largely not an issue anymore, so now BRIC funds look like underdiversified exposure to EM.
I mean, if you think about it, is there really an economic thesis around why you should own Russia and Brazil, but then skip a dozen other countries?
3:27
I also think that investors over time get more sophisticated.  And I imagine a lot of folks realize that whats happening in Brazil is utterly unrelated to what's happining in China right now.
Unique political risks, unique economic positions, etc.
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