GURU - NANC And KRUZ: Illusion Or Alpha?
2024-06-13 17:59:59 ET
Summary
- Unusual Whales is an options platform that tweets market tidbits and has launched its own ETFs, NANC and KRUZ with Subversive Capital Advisors.
- NANC captures Democratic Congresspersons' portfolios, while KRUZ captures Republican Congresspersons' portfolios based on public disclosure filings.
- Unusual Whales and Subversive allege that Members of Congress use insider information to profit from trading, and investors can follow these trades via NANC and KRUZ.
- However, aside from the inherent sectoral biases of the two parties, there is no evidence so far the Subversive trading strategy generates any 'alpha'.
- I believe NANC and KRUZ are two novelties that are best kept on a 'watchlist' until they demonstrate they generate 'alpha'.
Unusual Whales is a social media account that I occasionally follow. The account tweets interesting market tidbits throughout the day and is mostly an advertising front for its options flow platform, which it claims to be " a platform being developed for retail traders , by retail traders . " So when I learned Unusual Whales has launched its own ETFs, the Unusual Whales Subversive Democratic Trading ETF ( NANC ) and the Unusual Whales Subversive Republican Trading ETF ( KRUZ ), I simply had to see what they were about.
Overall, the two funds are broadly diversified funds holding over 700 and 400 securities respectively. The main difference is that the NANC ETF favors 'new economy' stocks and is heavily overweight Technology stocks. In contrast, the KRUZ ETF is overweight 'old economy' sectors like Financials, Energy, and Industrials....
NANC And KRUZ: Illusion Or Alpha?