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Politics are increasingly creeping into all areas of American life, and for better or worse, investing is not immune to this phenomenon. We recently covered the growing number of ETFs that allow people to invest in companies that they believe are aligned with their viewpoints. These ETFs do this by screening for companies that donate money to political candidates or causes.
Now, Subversive ETFs has unveiled an interesting new twist on political ETFs with two brand new ETFS, one for each opposing side of the aisle — the Unusual Whales Subversive Republican Trading ETF (BATS:KRUZ) and the Unusual Whales Subversive Democratic Trading ETF (BATS:NANC). How do they work, and could they be worthy of a place in your portfolio?
How Do These ETFs Invest Like Political Insiders?
As one might guess, the Democratic version of this ETF’s ticker is a reference to Democratic congresswoman and former Speaker of the House Nancy Pelosi, while the Republican ying to NANC’s yang is named for Ted Cruz, the high-profile Republican Senator from Texas and former presidential candidate.
While a number of ETFs allow investors to invest in stocks that they feel like match up with their political preferences, these two new ETFs take a whole new approach. Instead of merely tracking which companies make donations to politicians, NANC and KRUZ utilize data provided by Unusual Whales, an options and equity data platform, to track what stocks members of Congress are buying and selling, using this information to invest alongside them. KRUZ invests in equities bought or sold by Republican members of Congress, while NANC does the same thing with Democratic members of Congress.
If you’ve spent any time on the financial side of Twitter (often called “FinTwit”) in recent years, you’ve likely seen plenty of accounts discussing the transactions made by Nancy Pelosi and her husband, Paul, and users joking (or perhaps only half joking), that Pelosi is a better investor than Warren Buffett based on her timely buys and sells before major news comes to light about some of these stocks.
While the ability of politicians to enrich themselves based on inside knowledge and influence they derive from positions as lawmakers is an unseemly part of U.S. politics (the U.S. is the only democracy in the world that allows officeholders to invest like this), I give Unusual Whales and Subversive ETFs credit for using data to level the playing field and at least…
Click Here to Read the Full Original Article at TipRanks Financial Blog…
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