Maybe FAANG Isn't For You, But BAT May Be

Long before the trade war started, investors have been arguing over whether it’s better to invest in an established market like the US or growing, larger population market like China. This debate has stretched for years, well before the terms FAANG (Facebook (FB), Apple (AAPL), Amazon.com (AMZN),Netflix (NFLX), and Alphabet (GOOG)(GOOGL)) or BAT (Baidu (BIDU), Alibaba (BABA), and Tencent (TCEHY)) were coined.

But now, as the trade war between China and the US continues to heat up, investors have been battling over another China Vs. US technology investments. Perhaps because these stocks have been monster winners and some believe that since these companies are mainly technology stocks, they will be exempt from the pain that could come from the trade war. However, while it is unknown how much the trade war will affect these big technology companies, it should be noted that if each country’s economy suffers from the new tariffs, that the FAANG and BAT stocks could feel some adverse effects.

But in the meantime, if you are still interested in finding some Exchange Traded Funds which will give you exposure to FAANG and BAT stocks, you are in luck. I recently highlighted a few FAANG related ETFs which you can read about here, or continue below for some BAT related ETFs. Continue reading "Maybe FAANG Isn't For You, But BAT May Be"

A Few Bond ETFs That Have Performed Well, Despite Rising Interest Rates

Investors who buy bonds or bond funds are doing so because they want to reduce their risk and preserve their capital. Bonds work very well at doing this when the stock market or economy is declining, but not when economic conditions are strong.

Currently, the US economy is strong with 4% GDP growth, the S&P 500 coming close to setting a new all-time high, the unemployment rate at the lowest level its been in years. All of these indicators point towards the opposite of what bond investors want, especially the need for higher interest rates as inflation continues to creep higher.

Recently JP Morgan Chase’s CEO, Jamie Dimon, said he thought the 10-year Treasury yield should be at 4%, not where it currently sits at the below 3%. He went further and said that 5% interest rates are coming and that investors need to start preparing. Some have argued that interest rates should already be in the 4% to 5% range.

If, Dimon and others are correct in their prediction that higher interest rates are coming than current bond holdings need to “Get out of Dodge” before they get burnt. We have already seen bond funds take a hit in 2018, but if rates do climb as high as 5%, the losses we have seen thus far may dwarf what is to come.

Not surprisingly the best Bond Exchange Traded Funds over the past year are the 3X leveraged short funds. Continue reading "A Few Bond ETFs That Have Performed Well, Despite Rising Interest Rates"

Shark Tank's "Kevin O'Leary" Has A New Fund

Kevin O’Leary is best known for his antics on Shark Tank, but to those on Wall Street, he is known for his more conservative approach to investing. O’Leary started his O’Shares ETF Investment firm back in 2015 and launched the firm's first fund the O’Shares FTSE U.S. Quality Dividend ETF (OUSA). A month after releasing that fund he rolled out two more, the O’Shares FTSE Europe Quality Dividend ETF (OEUR) and the O’Shares FTSE Asia Pacific Quality Dividend ETF (OASI).

His next two ETF’s came in 2016 and 2017 and if perhaps you could guess what phrase was in the name of both of those? Quality Dividend!

The O’Shares FTSE Russell Small Cap Quality Dividend ETF (OUSM) starting trading December 30th, 2016 while the O’Shares FTSE Russell International Quality Dividend ETF (ONTL) began trading on March 22nd, 2017.

The first five funds O’Leary has rolled out focused on companies with strong balance sheets, and that paid a nice dividend, what most investors would refer to as “conservative” investments. But, his newest ETF, the O’Shares Global Internet Giants ETF (OGIG), is a lot less about quality dividends and more about quality business and growth potential. So, O’Leary is still looking for quality businesses, but with more growth opportunity than dividend income like his past ETF’s. Continue reading "Shark Tank's "Kevin O'Leary" Has A New Fund"

Winklevoss Bitcoin ETF Rejected Again

In March of 2017 the Winklevoss twins had their first Bitcoin ETF proposal rejected and now the second Winklevoss Bitcoin ETF proposal was dismissed in July of 2018 by the Securities and Exchange Commission. The reason all of this matter is because the Winklevoss twins where the first to have the SEC rule on a Bitcoin ETF back in 2017, and now that their proposal has been rejected for a second time things are starting to look a little bleak for investors who want a Bitcoin ETF.

First and foremost, the Securities and Exchange Commission that made the ruling expressed concern about Bitcoin’s trading reliability and security; two significant issues which don’t appear to be easy fixes anytime soon. The commission went on to say “The record before the commission indicates that a substantial majority of bitcoin trading occurs on unregulated venues overseas that are relatively new and that, generally, appear to trade only digital assets.” The commission stated that more then 75% of Bitcoin trading happens on unregulated foreign exchanges.

But, the commission did note that regulated Bitcoin markets are in their early stages of development and that if they further grow, the commission would then review the idea of allowing a Bitcoin ETF based on SEC requirements. Continue reading "Winklevoss Bitcoin ETF Rejected Again"

Bitcoin Helped ARK Win 'Top ETF' in 2017

ETF.com’s “ETF of The Year” award went to the ARK Innovation ETF (ARKK) for 2017. The award was given to ARKK for a number of reasons, but the top two were due to its exposure to disruptive technology in 2017 and its strong performance. Both of those key metrics for winning the award were partly due to the fund's exposure to Bitcoin.

ARKK owned Bitcoin through buying shares of the Bitcoin Investment Trust (GBTC). ARKK had anywhere between 6% and 10% of its assets in GBTC during 2017 while the cryptocurrency rose higher during the end of last year. During that time Bitcoin was often ARKK’s top holding. This helped the fund produce an 85% return for investors in 2017. Just for comparison, GBTC was up roughly 1,550% in 2017.

What’s more interesting though is that while GBTC is now down more than 65% year-to-date in 2018, ARKK is up more than 21% this year. The main reason for this reversal is because sometime in January of 2018 ARKK’s management team started selling their position in GBTC. As of today, ARKK still has a small position in GBTC, but it represents just 0.26% of the fund's assets.

ARK, the issuer of the ARKK ETF recently told ETF.com that it was a “complicated decision” to cut its Bitcoin investments, but that it was driven largely by regulatory and tax concerns, more so than the true “merits” of Bitcoin. Continue reading "Bitcoin Helped ARK Win 'Top ETF' in 2017"