This week’s news: BlackRock hits $10 trillion in assets under management. ĭiscussing themes of harnessing inner dialogue in Ethan Kross’s Chatter. Shows, updates, and an introduction to our guests for today. Wrapping up, Wes along with Robin Taub join us for a lively round of Talking Cents. Toward the end of our show, we invite Wes Gray from Alpha Architect to talk about their change from index to active ETFs and more. This means that while thematic ETFs are good business for the ETF providers, they do not create value for investors on average. By the time a themed ETF becomes investable, it experiences a mean reversion of prices and media sentiment, in contrast to the attractive returns shown in its backtested index. The problem we find with these ETFs is that as the markets they are based on attract more attention and an influx of entrants, everybody’s per-share earnings get reduced. The concept behind investment themes is that they ostensibly offer investors the opportunity to participate in potentially disruptive trends with the idea of earning excess returns. A thematic ETF is a fund that offers the opportunity to invest based on a particular theme, such as climate change or artificial intelligence. ![]() As we all know, not all investments are equally exciting, but on today’s show, we make the case that you should not put your money into an ETF just because it is trending.
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