Design Your Own ETF

State Street is reasonably speaking making a big deal for the the S&P 500 SPDR's (SPY) 20th anniversary including a contest to "design" your own ETF. Contest might be the wrong word because I didn't find anything about winning. Maybe they are just harvesting their database for ideas or as it said maybe this really is just a fun thing.


Over the years we've had quite a few ideas for new funds. A very long time ago (relative to the blog) we talked about a fishery ETF and a farmland ETF and funny enough those actually came to market but didn't last too long unfortunately. Another idea was a toll road ETF and Global X has an open filing for a toll road/airport/seaport ETF but based on how long ago they filed for this one it doesn't seem like it will come out.

Other ideas that have not come to fruition included cement companies, countries like Kazakhstan and one for the publicly traded stock exchanges. Below is the writeup I submitted for an ETF covering the exchanges. I don't have high expectations but I do believe it would be a worthwhile fund.

The idea is an narrow based ETF that owns publicly traded stock exchanges around the world. There are enough foreign and domestic exchanges to populate a fund. It would make sense for this to be a modified market cap construction so no holding gets to 20% or some other huge number as might be the case if ICE goes through buying NYX. There are a couple of capital markets ETFs already but they are broader than just owning the exchanges, they also own banks and mutual fund companies.This fund would capture development of capital markets in countries where stock market investing is new, it would offer some yield (the exchanges in New Zealand and Australia have high yields) and offer some stability with more mature US exchanges which also offer some yield. This would be financial sector exposure without worrying about another shoe dropping with the banks.
The picture is Google's tribute to Jackie Robinson's 94th birthday yesterday.
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