Other People's Money with Max Wiethe Bringing Long/Short Hedge Fund Strategies to ETFs | David Orr (Bonus Episode)
Oct 16, 2025
David Orr, a seasoned long/short equity investor and manager of the Militia Long/Short Equity ETF, dives into the dynamics of blending hedge fund strategies with ETFs. He shares insights on why he launched an ETF alongside a successful hedge fund, discussing liquidity management and compliance challenges. David reveals how ETFs can attract diverse investors and the importance of transparency. He also discusses regulatory hurdles and marketing tactics, while emphasizing the nuanced costs of trading in these structures. A rich conversation for finance enthusiasts!
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ETF Sleeve For Scalable, Tax-Efficient Alpha
- ETFs scale better long-term because they have lower fees and tax efficiency compared to hedge funds.
- David Orr sees ETFs as a durable sleeve for larger-scale strategy while preserving a smaller, high-edge hedge fund.
Prioritize Edge Over Pure AUM Growth
- Prioritize performance-oriented business design over pure AUM marketing if you value longevity and edge.
- Use a small hedge fund to keep edge and an ETF for scale and sticky, tax-deferred investors.
Tax Stickiness Creates Durable Investors
- ETF investors who hold through large gains face a rational tax stickiness that increases retention.
- Orr views that stickiness as a durable, predictable revenue stream with strategic exit options.