Resurrection Payout

Bloomberg has been a lot talking about betting markets for the last couple of days.

Volume has gone up considerably as people figure out there is no end to the things to bet on. Supposedly someone won a large bet involving the seizure of Nicolas Maduro. A little more amusingly, a bet paid off because Jesus did not return in 2025. It didn't pay out a lot not surprisingly but what I do think is interesting is that the payout for him not rising was slightly better than a Treasury bill. 

A few days ago we took a look at prediction markets like Kalshi and Polymarket and wondered if some sort of fund strategy that made thousands of bets through Kalshi, Polymarket or both might yield some sort of absolute return result or maybe look like a form of arbitrage. The Jesus bet paying off 5.5% gives me a little hope of that possibility. Just a little fun. 

Speaking of things not correlated to anything, I reached out to a couple of contacts at different liquid alt mutual fund companies about litigation finance in a fund wrapper. Interestingly, both companies have looked into it. One of the two gave a little more color saying that to put it into a daily liquidity wrapper like a mutual fund, it would require tokenization of the loans to make them more easily transferable. 

There's a lot of talk about tokenizing everything so why not litigation finance? In that post about it from a couple of weeks ago I mentioned trying to follow this to see where it goes. So this is what that looks like. I learned a little more, good, no progress out there though, at least not yet. 

An ETF provider called Tapp Alpha has a couple of derivative income funds, one tied to the S&P 500 and one tied to the NASDAQ. Tomorrow (per a Tweet so it may be incorrect), Tapp Alpha is launching 1.3x leveraged versions of those two funds. In with their literature they refer to "slight" leverage. On a related note, GlobalX has a 1.25x levered S&P 500 ETF that trades in Canada. Direxion filed for a similar ETF but Copilot said it never launched. 

While I am skeptical about the ReturnStacked funds due mostly to the blending of assets, their content to support their funds has contributed mightily to our understanding of capital efficiency. In terms of one of our tenets here to take bits of process from various sources to create your own process, we've taken some of their process which that capital efficiency might be a good idea and now we're trying to see if there is a better way to use it. Like many things, leveraged funds are only going to evolve. Hopefully that means they will improve and maybe "slight" leverage is the answer?

Following through on yesterday's post about my process, this is time spent that may not yield any results. It's too soon to know but curiosity to learn and explore is important. 

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