ETFs that "remove Musk" are coming: Wall Street launches new products to help investors "avoid" Space X and Tesla
"Daily Economic News" reporters learned that on Wednesday (July 8), SubversiveETFs, a Wall Street alternative ETF issuer, submitted filings to regulatory authorities and planned to issue two exchange-traded funds (ETFs). These two funds will track the Nasdaq 100 Index and the S&P 500 Index respectively, but excluding all companies founded, controlled or directed by Elon Musk, currently it seems that they are mainly SpaceX and Tesla.
"Daily Economic News" reporters learned that on Wednesday (July 8), Subversive ETFs, a Wall Street alternative ETF issuer, submitted filing documents to the regulatory authorities and planned to issue two exchange-traded funds (ETFs). These two funds will track the Nasdaq 100 Index and the S&P 500 Index respectively, but excluding all companies founded, controlled or directed by Elon Musk, currently it seems that they are mainly SpaceX and Tesla. In fact, there are already a large number of ETFs on the market that heavily hold Musk-related assets, and Wall Street is preparing to launch inverse products to serve investors who do not want to hold stocks of Musk's companies. Industry insiders pointed out that this filing highlights the common status quo behind the booming development of the ETF industry: as long as investors can think of a certain trading logic, Wall Street will have a way to package it into an ETF product with an exclusive code. Some analysts also judge that this is just a marketing gimmick and there is no rigorous and feasible investment logic. “De-Musk” ETFs are coming An innovative ETF from Wall Street has recently attracted the attention of the entire market. Alternative ETF issuer Subversive ETFs recently submitted application documents for two ETF products to the SEC (U.S. Securities and Exchange Commission), namely the Nasdaq-100 Ex-Elon Enterprises ETF (code QQNE) and the S&P 500 Ex-Elon Enterprises ETF (SPNE). To put it simply, the company plans to issue two ETFs, tracking the Nasdaq 100 Index and the S&P 500 Index respectively. However, both funds will exclude companies that the fund manager determines are founded, controlled, and managed by Musk, or that he is deeply bound to as a major shareholder or founder. Currently, only SpaceX and Tesla are eligible. According to the existing rules of the S&P 500 Index, SpaceX will not be included in the index for at least a year and longer. Therefore, the SPNE fund essentially fully covers the S&P 500 constituent stocks and only excludes Tesla. The QQNE fund includes all Nasdaq 100 constituent stocks, excluding SpaceX and Tesla. Nasdaq has recently implemented new regulations. SpaceX was successfully included in the index on Tuesday without the need to simultaneously remove other existing constituent stocks. Taking QQNE as an example, Subversive ETFs stated in the product's application materials that the investment goal is to achieve capital appreciation by allocating U.S. large-cap stock assets, while excluding all corporate stocks founded, controlled, and managed by Musk, or that have deep core connections with Musk. Fund managers believe that excluding Musk-related companies can not only provide investors with an asset allocation similar to that of U.S. large-cap stocks, but also meet the needs of a type of investors who believe that Musk-related companies generally have problems such as corporate governance risks, policy risks, and large fluctuations in stock prices, making investments less attractive. Marketing gimmick or market need? There are different voices in the market surrounding these two ETFs that "remove Musk". Many industry analysts clearly pointed out that this approach is more gimmick than reality. For example, Morningstar analyst Jeffrey Ptak told the media: "I can understand the eagerness of issuers to create differentiated products and seize the market. However, investors still need to remain vigilant: such products may lack reasonable long-term investment value, but require investors to pay high costs for minimal improvement in returns." Dave Nadig, president and director of research at ETF.com, an ETF information platform, is also extremely negative. In a media interview, he said that this type of product is just another "marketing gimmick", just to attract investors who are disgusted with Musk. However, like other narrow-track theme ETFs, there is a high probability that they will not accumulate considerable management scale.
Public information shows that Subversive ETFs is a specialty ETF issuer on Wall Street. It does not follow the traditional broad-based and industry track route, and specializes in creating novelty-oriented ETFs that bind public attitudes and public opinion hot spots. For example, the company also has two ETFs whose investment targets are stocks bought and sold by U.S. Republican and Democratic congressmen and their spouses. Some people have also seen changes in the continuous segmentation of the industry from the declaration of such products. Bloomberg pointed out that for many years, the industry has been scrambling to convert various investment views on Musk into tradable financial products, and this filing is just the latest example. Investors can currently purchase Tesla leveraged funds to amplify gains from the rise and fall of Tesla's stock price, and the market has just launched leveraged products linked to SpaceX; there was even an ETF with the code ELON before, which was long Tesla and short Ford Motor. As funds that "exclude Musk-related assets", it is still unknown whether QQNE and SPNE can attract capital inflows in the long term, but this filing clearly reflects the core logic of the ETF industry craze: as long as investors can imagine a trading idea, Wall Street can package it into a listed ETF. The ETF industry initially focused on low-cost index investment, but now it is increasingly moving towards personalized customization. The demand for niche theme funds has skyrocketed, and major issuers are rushing to launch special products - no longer simply tracking the market, but accurately betting on specific companies, executives and segmented investment tracks. For both the industry and investors, this is a new trend that cannot be ignored, and opportunities and potential risks also coexist. (
Public information shows that Subversive ETFs is a specialty ETF issuer on Wall Street. It does not follow the traditional broad-based and industry track route, and specializes in creating novelty-oriented ETFs that bind public attitudes and public opinion hot spots. For example, the company also has two ETFs whose investment targets are stocks bought and sold by U.S. Republican and Democratic congressmen and their spouses. Some people have also seen changes in the continuous segmentation of the industry from the declaration of such products. Bloomberg pointed out that for many years, the industry has been scrambling to convert various investment views on Musk into tradable financial products, and this filing is just the latest example. Investors can currently purchase Tesla leveraged funds to amplify gains from the rise and fall of Tesla's stock price, and the market has just launched leveraged products linked to SpaceX; there was even an ETF with the code ELON before, which was long Tesla and short Ford Motor. As funds that "exclude Musk-related assets", it is still unknown whether QQNE and SPNE can attract capital inflows in the long term, but this filing clearly reflects the core logic of the ETF industry craze: as long as investors can imagine a trading idea, Wall Street can package it into a listed ETF. The ETF industry initially focused on low-cost index investment, but now it is increasingly moving towards personalized customization. The demand for niche theme funds has skyrocketed, and major issuers are rushing to launch special products - no longer simply tracking the market, but accurately betting on specific companies, executives and segmented investment tracks. For both the industry and investors, this is a new trend that cannot be ignored, and opportunities and potential risks also coexist. (