Mama, there goes that man again. Dave Portnoy, El Presidente and Founder of Barstool Sports, is helping promote a new ETF that is set to hit the market on March 4th. The VanEck Vectors Social Sentiment ETF, or BUZZ, is the newest exchange-traded fund to hit the New York Stock Exchange.
BUZZ uses an algorithm and artificial intelligence to scrape the internet and social media, finding 75 large-cap stocks that are getting the most positive interactions on sites like Reddit, Twitter, etc. It will go through around 15 million online posts a month to generate which stocks will be in the fund, essentially tracking the "social buzz" (hence the name). The fund will hold stocks with market capitalizations of over $5 billion. So Portnoy is involved, so it must be good, right? Well, yes. The algorithm behind the ETF beat the S&P 500 by 42% in 2020.
A typical ETF tracks an index or sector, while BUZZ will have constantly moving positions, creating an "active ETF" that correlates the habits of online conversation. Some companies listed on the index currently include Twitter ($TWTR), DraftKings ($DKNG), and Amazon ($AMZN). With the recent popularity of retail investors, BUZZ will certainly be the talk of the town for weeks to come. With Portnoy's name and reputation behind the index, it is a safe bet to say that $BUZZ will soar. The ETF will be available to the public Thursday morning (3/4/21).