Show Us Your Portfolio: Mike Green
Excess Returns
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The Importance of Derivatives in ETFs
The introduction of what's called the derivative rule in September of 2020 that allowed efficient inclusion of derivatives within ETFs has fundamentally changed the game. From a high net worth individual standpoint, hedge funds are incredibly inefficient and if they incorporate derivative dynamics, you're paying short term gains on basically everything. So it is the quote unquote right structure for the investor. It's a structure that is less advantageous to the manager unless you're able to slowly grow the asset base over time.
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