Posts filed under “ETFs”
TBTF ETF Backtest (Red)
I am putting together a new ETF that consists entirely of companies that have become so large and systemically important that they are guaranteed survival regardless of their own incompetency.
It is a market cap weighted index (naturally) so that those names that represent the greatest threat to the overall economy have the highest weighting. Full universe of potential holdings are here.
Ticker symbol: TBTF
Top 10 Holdings
Bank of America
Note: Because shareholders got wiped out in the GM and Chrysler bankruptcy, they do not qualify.
We expect trading to begin May 1. Full disclosures and documentation available on request.**
We also be rolling out the leveraged version — 200% long, symbol XTBTF, and of course, the Ultra — a triple leveraged ETF, symbol UTBTF.
We will be following the domestic ETF with an international version: TBTFi (not to be confused with the BlackRock’s offering, iTBTF). It will be filled with ECB notes, Japanese banks, Sovereign debt from Greece and Cyprus, etc. For diversification purposes, it is important to own TBTF banks in various geographic regions in case of local central bank collapse or nuclear accident.
* AIG is really in there as a sentimental favorite, but they are no longer truly TBTF.
** No, not really, as this is sarcasm.
Since it is a Friday (following Valentine’s Day), I want to step back from the usual market gyrations to discuss a broader topic: The pursuit of Alpha, where it goes wrong, and the actual cost in Beta. For those of you unfamiliar with the Wall Street’s Greek nomenclature, a quick (and oversimplified) primer: When we…Read More
click for larger charts
Source: Bianco Research
Some of the charts nearby, courtesy of Bianco Research, put it into perspective visually.
By way of their simplicity, low cost and passive indexing, ETFs are becoming the most dominant product in finance.