Brian Jacobs
@jacobsbrian.bsky.social
ETF strategist | Investment nerd | Dad x3 | Trying to simplify the complex | Baseball, basketball, and big / weird ideas
Enter structured (i.e. return stacked) ETFs.
These innovative products combine alpha generation, market beta, and sometimes leverage, all within a tax-efficient wrapper.
Think about layering the Eurekahedge Hedge Fund Index’s returns on top of core market beta.
These innovative products combine alpha generation, market beta, and sometimes leverage, all within a tax-efficient wrapper.
Think about layering the Eurekahedge Hedge Fund Index’s returns on top of core market beta.
December 12, 2024 at 7:02 PM
Enter structured (i.e. return stacked) ETFs.
These innovative products combine alpha generation, market beta, and sometimes leverage, all within a tax-efficient wrapper.
Think about layering the Eurekahedge Hedge Fund Index’s returns on top of core market beta.
These innovative products combine alpha generation, market beta, and sometimes leverage, all within a tax-efficient wrapper.
Think about layering the Eurekahedge Hedge Fund Index’s returns on top of core market beta.
This isn’t a one-off story. The Eurekahedge Hedge Fund Index, tracking 3,000+ funds, has underperformed the S&P 500 by over 7% per year over the past decade.
The result? Underperformance + higher taxes + hefty fees = frustrated investors.
The result? Underperformance + higher taxes + hefty fees = frustrated investors.
December 12, 2024 at 7:02 PM
This isn’t a one-off story. The Eurekahedge Hedge Fund Index, tracking 3,000+ funds, has underperformed the S&P 500 by over 7% per year over the past decade.
The result? Underperformance + higher taxes + hefty fees = frustrated investors.
The result? Underperformance + higher taxes + hefty fees = frustrated investors.
Blog Post: ETFs as Hedge Funds 2.0: A Better Way to Capture Beta and Alpha?
Hedge funds often fall short.
Case in point: Warren Buffett’s 2007 bet. He wagered $1M that an S&P 500 index fund would beat a selection of hedge funds over a decade.
The S&P 500 crushed all five hedge fund portfolios.
Hedge funds often fall short.
Case in point: Warren Buffett’s 2007 bet. He wagered $1M that an S&P 500 index fund would beat a selection of hedge funds over a decade.
The S&P 500 crushed all five hedge fund portfolios.
December 12, 2024 at 7:02 PM
Blog Post: ETFs as Hedge Funds 2.0: A Better Way to Capture Beta and Alpha?
Hedge funds often fall short.
Case in point: Warren Buffett’s 2007 bet. He wagered $1M that an S&P 500 index fund would beat a selection of hedge funds over a decade.
The S&P 500 crushed all five hedge fund portfolios.
Hedge funds often fall short.
Case in point: Warren Buffett’s 2007 bet. He wagered $1M that an S&P 500 index fund would beat a selection of hedge funds over a decade.
The S&P 500 crushed all five hedge fund portfolios.
More a reflection of Greece's improved standing than France's deterioration (at this point at least), but this wasn't an outcome that would have been deemed possible a decade ago
December 4, 2024 at 8:18 PM
More a reflection of Greece's improved standing than France's deterioration (at this point at least), but this wasn't an outcome that would have been deemed possible a decade ago
3) CAPE cannot be compared across markets
US Fundamentals have simply been better.
If a market grows EPS by 10% annually, CAPE rises even if the trailing P/E stays constant.
Meanwhile, a market with flat or negative EPS growth could look "cheaper" on CAPE despite weaker fundamentals.
US Fundamentals have simply been better.
If a market grows EPS by 10% annually, CAPE rises even if the trailing P/E stays constant.
Meanwhile, a market with flat or negative EPS growth could look "cheaper" on CAPE despite weaker fundamentals.
December 4, 2024 at 6:16 PM
3) CAPE cannot be compared across markets
US Fundamentals have simply been better.
If a market grows EPS by 10% annually, CAPE rises even if the trailing P/E stays constant.
Meanwhile, a market with flat or negative EPS growth could look "cheaper" on CAPE despite weaker fundamentals.
US Fundamentals have simply been better.
If a market grows EPS by 10% annually, CAPE rises even if the trailing P/E stays constant.
Meanwhile, a market with flat or negative EPS growth could look "cheaper" on CAPE despite weaker fundamentals.
2) CAPE ignores the impact of buybacks, which boost EPS by reducing share counts.
CAPE ignores the impact of buybacks, which boost EPS by reducing share counts.
Two identical companies:
A: Pays dividends
B: Does buybacks
CAPE values B as "more expensive," even if their businesses are identical.
CAPE ignores the impact of buybacks, which boost EPS by reducing share counts.
Two identical companies:
A: Pays dividends
B: Does buybacks
CAPE values B as "more expensive," even if their businesses are identical.
December 4, 2024 at 6:16 PM
2) CAPE ignores the impact of buybacks, which boost EPS by reducing share counts.
CAPE ignores the impact of buybacks, which boost EPS by reducing share counts.
Two identical companies:
A: Pays dividends
B: Does buybacks
CAPE values B as "more expensive," even if their businesses are identical.
CAPE ignores the impact of buybacks, which boost EPS by reducing share counts.
Two identical companies:
A: Pays dividends
B: Does buybacks
CAPE values B as "more expensive," even if their businesses are identical.
1) The U.S. market has evolved dramatically
CAPE’s numerator reflects CURRENT market caps of today’s leaders, but the denominator uses decade-old EPS when those stocks were much smaller.
Example: NVDA price now reflects massive growth, but CAPE uses earnings from when it was 0.06% of the index.
CAPE’s numerator reflects CURRENT market caps of today’s leaders, but the denominator uses decade-old EPS when those stocks were much smaller.
Example: NVDA price now reflects massive growth, but CAPE uses earnings from when it was 0.06% of the index.
December 4, 2024 at 6:16 PM
1) The U.S. market has evolved dramatically
CAPE’s numerator reflects CURRENT market caps of today’s leaders, but the denominator uses decade-old EPS when those stocks were much smaller.
Example: NVDA price now reflects massive growth, but CAPE uses earnings from when it was 0.06% of the index.
CAPE’s numerator reflects CURRENT market caps of today’s leaders, but the denominator uses decade-old EPS when those stocks were much smaller.
Example: NVDA price now reflects massive growth, but CAPE uses earnings from when it was 0.06% of the index.
The CAPE ratio, introduced by Robert Shiller in 1988, is a popular tool for assessing market valuation. But its track record shows consistent underestimation of U.S. equity returns—missing by 5-10%+ over many periods.
aptuscapitaladvisors.com/beware-cape-...
Let’s explore.
aptuscapitaladvisors.com/beware-cape-...
Let’s explore.
December 4, 2024 at 6:16 PM
The CAPE ratio, introduced by Robert Shiller in 1988, is a popular tool for assessing market valuation. But its track record shows consistent underestimation of U.S. equity returns—missing by 5-10%+ over many periods.
aptuscapitaladvisors.com/beware-cape-...
Let’s explore.
aptuscapitaladvisors.com/beware-cape-...
Let’s explore.
Well… that was fun!
Last week I was fortunate to be on @bloomberg ETF IQ to talk about our new ETF $UPSD
You can find me starting at the 17:00 minute mark: lnkd.in/ghY-_Ag2
Feel free to DM with any questions
Last week I was fortunate to be on @bloomberg ETF IQ to talk about our new ETF $UPSD
You can find me starting at the 17:00 minute mark: lnkd.in/ghY-_Ag2
Feel free to DM with any questions
December 1, 2024 at 4:29 PM
Well… that was fun!
Last week I was fortunate to be on @bloomberg ETF IQ to talk about our new ETF $UPSD
You can find me starting at the 17:00 minute mark: lnkd.in/ghY-_Ag2
Feel free to DM with any questions
Last week I was fortunate to be on @bloomberg ETF IQ to talk about our new ETF $UPSD
You can find me starting at the 17:00 minute mark: lnkd.in/ghY-_Ag2
Feel free to DM with any questions
But… while not cheap (by any measure) prices and even mortgage payments aren’t nearly the outlier relative to disposable income.
What has changed is they aren’t historically cheap like they were even a few short years ago.
Full post: aptuscapitaladvisors.com/housing-mark...
What has changed is they aren’t historically cheap like they were even a few short years ago.
Full post: aptuscapitaladvisors.com/housing-mark...
November 26, 2024 at 5:17 PM
But… while not cheap (by any measure) prices and even mortgage payments aren’t nearly the outlier relative to disposable income.
What has changed is they aren’t historically cheap like they were even a few short years ago.
Full post: aptuscapitaladvisors.com/housing-mark...
What has changed is they aren’t historically cheap like they were even a few short years ago.
Full post: aptuscapitaladvisors.com/housing-mark...
Housing Market and Affordability… 1/2
Home prices and especially mortgage payments (given prices and rates) are clearly elevated in nominal and real terms
Home prices and especially mortgage payments (given prices and rates) are clearly elevated in nominal and real terms
November 26, 2024 at 5:17 PM
Housing Market and Affordability… 1/2
Home prices and especially mortgage payments (given prices and rates) are clearly elevated in nominal and real terms
Home prices and especially mortgage payments (given prices and rates) are clearly elevated in nominal and real terms
Some last minute “stimulus” before budgets get pulled 👀
November 25, 2024 at 8:19 PM
Some last minute “stimulus” before budgets get pulled 👀
We see a lot of charts showing the outperformance of U.S. vs foreign stocks as some indication that mean reversion is on the way.
If earnings growth doesn’t revert, returns won’t either.
If earnings growth doesn’t revert, returns won’t either.
November 25, 2024 at 2:52 PM
We see a lot of charts showing the outperformance of U.S. vs foreign stocks as some indication that mean reversion is on the way.
If earnings growth doesn’t revert, returns won’t either.
If earnings growth doesn’t revert, returns won’t either.
You mean with unemployment at ~4% we weren’t in a worse situation than GFC lows?
November 25, 2024 at 1:47 AM
You mean with unemployment at ~4% we weren’t in a worse situation than GFC lows?
S&P 500 next month returns when the VIX curve is “normal” have been higher and lower risk.
Check out the full blog post outlining how an investor may take advantage. aptuscapitaladvisors.com/utilizing-vo...
Check out the full blog post outlining how an investor may take advantage. aptuscapitaladvisors.com/utilizing-vo...
November 25, 2024 at 1:43 AM
S&P 500 next month returns when the VIX curve is “normal” have been higher and lower risk.
Check out the full blog post outlining how an investor may take advantage. aptuscapitaladvisors.com/utilizing-vo...
Check out the full blog post outlining how an investor may take advantage. aptuscapitaladvisors.com/utilizing-vo...
Sometimes the VIX curve is like this… downward sloping as near term fears are elevated (in backwardation) such as during the GFC
November 25, 2024 at 1:43 AM
Sometimes the VIX curve is like this… downward sloping as near term fears are elevated (in backwardation) such as during the GFC
Sometimes the VIX futures curve is like this… upward sloping (in contango) signaling market risk is “normal” HT vixcentral.com
November 25, 2024 at 1:43 AM
Sometimes the VIX futures curve is like this… upward sloping (in contango) signaling market risk is “normal” HT vixcentral.com
The takeaway: The VIX term structure isn’t just a chart—it’s a tool. Using it effectively helps navigate uncertainty with clarity and purpose.
November 15, 2024 at 6:53 PM
The takeaway: The VIX term structure isn’t just a chart—it’s a tool. Using it effectively helps navigate uncertainty with clarity and purpose.
By understanding how expectations for volatility change over time, we can align our risk-taking with the market’s evolving outlook.
November 15, 2024 at 6:53 PM
By understanding how expectations for volatility change over time, we can align our risk-taking with the market’s evolving outlook.
The VIX term structure typically slopes upward—longer-term volatility is expected to be higher. But when markets panic, the curve inverts, signaling near-term fear. This shift can guide decisions on risk allocation.
Source: vixcentral.com
Source: vixcentral.com
November 15, 2024 at 6:53 PM
The VIX term structure typically slopes upward—longer-term volatility is expected to be higher. But when markets panic, the curve inverts, signaling near-term fear. This shift can guide decisions on risk allocation.
Source: vixcentral.com
Source: vixcentral.com