It's Not Equities

Apparently, Goldman Sachs put out a paper "making the case for buffer ETFs" and Cliff Asness made fun of them and linked to AQR's work that draws negative conclusions about buffers.  

One thing we try to do here is look at things that most people hate and see if there is a way to use them, maybe there's a contrarian angle? The crazy high yielding ETFs are an example of that.

One of the five above is the Innovator Defined Wealth Shield ETF (BALT). The other four are various alternative funds that lean market neutral/absolute return. BALT is not the purple line. Whichever one is BALT clearly is not a proxy for equities. On ETF IQ one time, someone from Innovator said that the symbol was a play on words for Bond ALTernative, BALT. So not equities. Don't look at it as equities. It's not equities. 

Is the return stream or volatility or real return useful in your mix? It doesn't have to be, I am not going to buy BALT anytime soon but I have several alts in my ownership universe that look like BALT.

Yes, this would turn out badly for the vast majority of people and yes, Tenev is talking his book but if it really is true that AI is crowding out entry level jobs then it is a decent bet that later stage jobs that people eventually get promoted into might also get crowded out. If all that happens then people will need to figure out how to make their way. This is all a path toward UBI and it's hard to see how UBI would be anything more than simply sustaining. People would need to figure something out, probably involving the internet even if that something is not trading for a living. 

Short one tonight.

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