Bokner Trillions.
I'm Joel Webber and I'm Eric Belchunas.
Eric, I started to see this flurry of research notes from Bloomberg Intelligence and one or two I was like, oh, that's kind of interesting, And then all of a sudden it was like, wait a second, there's like something to this that I think warrants an episode of Trillions, And most of it happened to be coming from Athanasio Sara Fagus on the BI team. What has he been writing about?
Yeah, so Athanasios, you know that like on sometimes on ESPN when they'll tell you like, hey, you know the Detroit Tigers are actually like zero and three when it's raining at night on a Tuesday afternoon.
Yeah, like much valued research insights right there.
Yeah. I didn't know I needed that, But that is interesting. That's Ethan for our team, and he's always unearthing these really interesting data points, and a lot of them have to do with how the markets are behaving under a Trump regime. I mean, it is a unique situation. I think everybody who's gone through it realizes it seems like there's a lot of chaos. Every other day, the sky's falling, and the media is just goes bananas, and a lot of times they're very negative. It's like, oh my god,
it's finally the markets are going to crash. Finally things are bad, and then it isn't. I mean, I have the numbers here. In Trump one point oh stocks one up eighty percent during that four years. That's a sixteen percent annualized return, so that's a little better than average average is like ten. And in Trump two point zero, stocks are up twenty five percent and that's sixteen percent annualized,
So you've gotten sixteen percent annualized return. However, what you've had to have done is just sort of ignore a couple really extreme situations and a more twitchy market. And Vanguard investors I think have done a good job of that. Not everybody. I think, honestly, some of the pros might be actually lagging because if you've taken the bait, you haven't done well. But supposedly, if you are a really
good trader, has been opportunities now and then. An Ethan has really found some data in the ETFs and the market that I think really help put numbers behind what everybody's feeling being a trader or an investor under a Trump presidency.
So to wade us through these years of anxiety that we've all endured to come to trading versus investing insights under President Trump is Athanasio Sera Vegas, who's a research analyst with Bloomberg Intelligence, this time on trillions. How to invest during a Trump presidency? Ethan welcome back to trillions.
Hey, nice to be backs intro.
Eric. Yeah, it's like STATUSY.
Didn't know you needed you needed?
Okay, So March happened and I noticed, you know, there's basketball, so March madness. But there's been a number of things that happened during Trump presidencies in March. Break that down for us.
Yeah, if that's how it kind of came to me, It's like, didn't we go through this last March? So we had obviously the Iran conflict this year. Last year was Tariff's under his first presidency, was COVID that wasn't really one's fault, but just happened to be towards March. So if you actually look at seasonality under Trump, March is really bad and normally the market's up in March, so it just tends to be really bad under his administration.
So I think this is the bigger story here is like just seasonality tends to be a little bit different under Trump's because you don't necessarily know what he's going to do, but he.
Might not know what he's gonna do.
Yeah, you don't know what something's gonna happen in March. Yeah, just so I don't know what next March will look like. But that said, April then tends to be really really strong under Trump, right because then he either backs off or the issue gets resolved into the market's rip, So they tend to be better than it normally under him. So I think just some things investors should pay attention to is that seasonality might break down under this administration.
If you're sort of used to, you know, months performing well, he might completely throw a wrench in this whole you know, seasonality analysis.
Eric, Are you really going to take that to the bank.
Yeah, look, this could be noise. I mean the data is really telling and the seasonality, I mean, February is a little bit bad, but marches are really bad. Rest of the year's pretty good, and the summers are great. Under Trump, I think the bigger takeaway is that there is a it's quick like when things seem to happen under Trump, they're very quick. Like remember twenty twenty two the Fed rays rates. That was like a year long affair.
You know, it was just bad for a year. It seems like under Trump things are like really bad for a minute and then they go up back up again. And I think that's sort of what the vanguard type investors are learning to ignore and the traders. I think the algos are trying to get ahead of of both the drop and the comeback up. And so there's Algos doing that and then Vanguard doing nothing. But I think where the tricky part comes in is Trump will do
or say something. Then the media is like, oh my god, if you know, if these tariffs happen, like everything's screwed up, and they really hammer that and it seems like the market's now going to go down for the next year, and it doesn't. And I think this also brings in that idea of Trump is I think watching the market, and the market I think has been a governor on him. So like whether there was the tariffs or Iran, it seems like every time the SMP got two down, he would like give good news.
Yeah, there's like a check.
Yeah, it looks like a check on him, because at the end of the day he wants to brag about the stock market, I think, and so I think that's the ultimate takeaway is his bark is sometimes worse than his bite. He does this as a negotiating style, and it's showing up in the data. Now why March, I don't know. I mean, we live in the Northeast. This month is the worst month in the year in my opinion. I mean, the Super Bowls over all, the holidays are over, and it's still cold, and you're like, I am so
over it. Like so, I don't know if it's like literally the seasonality of the season, but there is some some kind of voodoo going on in March.
There used to be three branches of governments. Now there's a fourth. It's called markets. And it's just that that's the check on Trump. Okay, So based on what you're saying, then if March February is bad, March is way worse. April comes back. So maybe I should stay out of things on March, double down, three X, leverage everything in April and then you know, according to conventional wisdom, here, ehn, I sell in May and go a how's that hold up.
Oh, that's another one that doesn't work.
You know.
It's these old technicians. They have like these old terms that they.
This one goes way back.
Yeah, I read the history of it goes back to actually London even before like the SMP existed with horse races. So basically the premise here is you sell in May and you go come back in October because it's such a week period. But then we looked at the last ten years. Do you know, by the way, that sounds great, but I think for a vacation it sounds good. But for investing it actually hasn't worked.
That's normal for Europe.
Yeah, that's all right, Maybe it works there.
Our big motto in the team troll is invest in the US so you can retire in Europe.
Okay, yeah, I think that's the move.
Well, Ethan's working on that. He's Greek, so you know, you know it's where to end up. So the what is the data show so about selling in May and going away.
Let's say if you did this over the last ten years, do you know how many years it was down there in this period? Can you guess?
Uh, things have just kind of like trucked upward. I guess one one year, one year.
Yeah, and even last year actually you would have missed out on a twenty two percent gain in the market. So I think let's sell, right, I'm not just not invested in general, but it's just it's tough. This adage doesn't seem to work. And then even if you did sell, so what would you do Probably go into bombs, right, So let's just compare stocks first bonds. Only in a handful of years that bombs actually do better than stocks
during this period. So I don't know why people still bring this up, right, it just seems like nothing there supports that you should be out of the market for six months. How far back did you go in your research because we're doing ETFs, I went back to using spy, which is thirty three or so years, which I think is pretty you know, I think a pretty.
Solid data set.
Yeah, and again only a handful of years was it actually down during this period?
Right?
If anything, sell in March, come in April. That might be the takeaway so far, don't sell in May, especially because the sommer months under Trump are also very good. But I think, like Ethan said, like just don't sell, and I think that's what the Van Guardians have figured out because every time there's the sell off, the most of the money into cheap beatis still comes in. One other interesting thing, and this is where I come to my intro of like, you know, whether the Detroit Tigers
are like what the record is at night? You know on a Tuesday, is that you have a stat here days of the week under Trump, So you have Monday, Tuesday, Wednesday, Thursday, Friday. Every single day of the week is up above the average except one which is way below the average. Again, this is like the day of the week version of the months, and that day is Thursday. So there's just something going on with Thursdays where it's just awful under Trump. Every other day, fine, what is that?
I think the first one we talked about Marx, that's just coincidental. This one, I think actually has a little bit more merit. I know it sounds ridiculous or like days of the week, but honestly, under Trump, it's exhausting, right, you don't know what he's going to say, what's going to happen during the weekend. So I think what is happening is people don't want to hold over the weekend. They want to sell their positions a d risk before
they go into Friday and over the weekend. So I think that's why there's more downloaded pressure on SAT on Thursdays. Just like I don't know what's going to happen. I don't want to be exposed to all this risk, and what tends to happen is not all the trading happens in the middle of the week Tuesday and Wednesday. So again, I know it sounds kind of ridiculous, but I think that is why there's a lot of de risking happening towards the end of.
The week so that we can have a decent Friday.
Yeah, I just enjoy your weekend started working on a Friday.
So Thursdays, if you're gonna be trading, Thursdays the ones to watch out for.
I nen though there's twenty four hour trading, but it's like, I don't know, that's exhausting. They're gonna be checking your accounts on the weekends, so if I don't know, you gotta get away from it for a little bit. So I think that's what's happening with this Thursday phenomenon.
Talk to me about night moves now, I don't want to know everything about your night moves. But just like how it really the trumpet, I mean those night moves, the g version please.
I think very similar to the Thursday phenomenon, and I think it works with a couple acid classes. So the night move is you would only hold the positions over right, so you buy it the clothes and then sell it the open. If you look at that relative to what the SMP is doing intra day like normal market hours, it's actually been better to hold overnight, but it's also been a lot more viold. And I think this feeds in again to the trump You know, you don't want time.
He's not going to tweet between nine thirty and four. You might tweet whenever, so you tend to have these really violent moves overnight, a pop up or down. I think this phenomenon is kind of catching on because now there's a bitcoin ETF that does this, and that one kind of makes sense, this twenty four hour trading and bitcoin.
So I think, again similar to the Thursday thing, people don't want to hold overnight, so they'll be selling during the day, and then there's a move that happens, you know, before the open, and you know and that seems to be working.
And now bring it back to your research, like, what what is the tangible takeaway here?
Don't hold the market during market hours, don't hold the S and P which is ridiculous, right, Like, I don't know how how much long jeopardy there is to it, but it just seems that this holding it overnight has been better been holding it during the day or more of the returns have come overnight. This doesn't always work, like there's been years where this doesn't work, but under Trump, it seems that this is more like.
Profound yeah, or just again hold the whole time.
Yeah, I don't overthinking.
We talk about that a lot on the team. It's like you know that midwit meme where there's like the dumb dumb and then the Jedi, and then there's the guy up at the top in the middle of the bell curve who's like, oh, we're gonna sell here by here do this, and all these numbers and greeks are coming out of his mouth, and like, honestly, like just whole good things are really the simple way to do this.
It's interesting about Athen's overnight study. He also found, unrelated to Trump, that bitcoin actually did better outside of US hours. In fact, almost all the returns since the ETFs came out, we're off of overnight sessions. And they actually now have an ETF that does that, called the night I forget what it's called night owl.
Yeah yeah, cooin one. Yeah.
By the way, so his research found the data to be true, but then since the ETF has come out, it's underperforming the regular one.
Yeah, and this is the danger with this kind of stuff, right, and yeah, we can find cool stats and anomalies, but you know, sometimes they don't necessarily translate into good investment ideas.
Okay, what you are describing throughout here kind of makes sense, Like just keep buying good stuff, hold it, don't make dumb decisions. Also, don't take you know, may till October off right rational? Uh, it does feel just as a civilian through all of this that there's a lot more freakouts. Is that does that? Is that real? Uh?
Definitely? Again, going back to you don't know what he's going to tweet. I think it's two things. One, just the growth of ETFs. They're becoming a bigger part of trading, so the numbers will go up. You know, we probably should inflation the justices, but nonetheless under Trump. So last year and then this year, we like to use sixty billion as a number, like if the SMP trades more than this, spy, this is sort of what we call like a freak out level. It's a really aggressive threshold.
Happened something like twenty plus times last year. It's a daily number, daily number, and this year is already a record and we're only in April, right, and a lot of times normally this happens during down markets, but with him there's also a lot of trading with upside too. So again I think it's just whether people are tense under him, or they feel maybe the market's more fragile in general. Anytime there's like something comes out of his mouth,
there's this quick trigger that people want to sell. There's a lot of rebalancing going on, maybe some profit taking. So there's definitely this elevated tension in the market than there were in years when he's not in his president.
In March this year, Jual the all ETFs traded nine trillion. That is far a record. It's almost like forty percent over the record, and it is just extraordinary. So I think a inflation like a trillion isn't what it used to be. But I do think again also the popularity of ETFs, people lean on them more when there's a problem. But I think in general, I think what you have is a lot of algos set up that like literally are linked to his Twitter and like his press conferences.
I remember this from Trump one point zero, and I just think that algos go wild trying to again front run a quick sellof and then front run the buyback, and so you have just machines fighting each other based on his tweets and whatnot. Because the ETF flows into like regular stuff, it's pretty consistent, and so I think a lot of this selling is like algos, and obviously ETFs becoming more popular and even used by some of
the hedge funds based on these algos. So but that's why ETFs broke the volume record last year and are probably a shoe in to break it this year. There Joel, the ETFs may trade close to one hundred trillion dollars in volume this year. I'm old enough to remember when like twenty thirty trillion was a record year, and they're going to break the record. Last year, the record was set at fifty five sixty they're on pace for like
ninety two ninety five trillion. It's unbelieved when we're going to pass last year's mark, I mean probably like August September at this rate, all right, which is wild. Yeah, it's it's crazy. But I think Trump's part of that. I think the other part of it is just as way more products and way more people using ETFs. Even some of the bigger fish that have come around and
use them for certain things. They when they trade, they had trade with a lot of money, and so the dollar volume number definitely gets inflated by them.
Spy makes for a really great proxy for research like this, But I'm curious because it's kind of not the same thing that it used to be, right as like it's still you know, if you're looking at trading like it's it's still number one, but you've got like VU an IVV that have really starting to like erode some of that number one feeling. You have to account for that by like you know, broadening your s and P five hundred research a little bit.
I think eventually we're gonna have to. Then. I think with that, the fact that it still reaches these thresholds is still impressive. Because it's competing with more products now, but I agree. I think at some point we're probably gonna have to look at an aggregate of a bunch of smp ets just because the growth of the I mean, the VO is about to hit a trillion dollars, so you know that's significant, not nothing, So it needs to be accounted for.
Eric says, trillion is not anything anymore like now that we now that we have inflation. But I you know, I apologize in advance that I just made your research a little bit more complicated.
You're gonna have to change the name of this podcast. Inflation adjusts that eventually trillions Moss.
Okay, your final insight. Don't fight the Fed or the White House. What's that about?
Man? Okay, So this is not our idea. But this was a NETF that was filed called the Government Griff GRFT Creative. It's from Tuttle. Uh So basically this was soccer. Yeah, this was to buy companies that are closely tied to the government's current administration. And so you know, we there's some you know, no one wants to list it. That's the problem. That's why it's still in filing. So we tried to recreate it, and for the most part you can get some real it's pretty simple, like the government
is taking steaks in these certain companies. Trump Intel's one, Oh yeah, that's been a good one, or he's literally putting tickers in his tweets. Right, So, if let's say, if we were to build a portfolio of this, it would have done really well, right compared to the S and P. Even if you bought it after you don't know when they're going to take these positions. Even if you buy it after, it's done way better than the
S and P five hundred. So just we had this idea, it's just sometimes don't overthink it, right however you feel about government taking states, steaks and companies, but all the most if you built this basket, well most of them have been up ever since they took a stake in it. And there's something that exists out there. There's one that tracks picks from Democratic candidates and Republican candidates, so those
names would probably be in this portfolio as well. But yeah, just instead of you know, don't fight what they're going to buy, they're literally telling you what tickers they're buying, and that just for now has been a strategy that's paid off if you ended up falling into those same tickers.
All right, Joel, let me read some of the stocks that Ethan put in his basket and why so, Intel, MP Materials, Lithium, America's Trilogy Metals, and USA Rare Earth. Those are all literal government stakes, and all of them are up a ton, except Trilogy is about flat. But that's you got in retrospect. How obvious Navidia and AMD are revenue sharing. They're both up palenteered down. That was one where he just endorsed it, and then there's some other ones based on the Golden Dome and then Trump
ties like American Bitcoin that's down a lot. So not all of them did well, but as a group, they've done very well. And again this is a so it's interesting that you could package this in the ETF. I will say that the government grift ETF from tuttle it. Honestly, if it come out, I think it would start to see some assets, but no exchange will list it. I think the title is just a little too cynical, but
I've never seen that droll. This is like total punk rock, where like it's so controversial, like none of the major exchanges will even let a trade there ses he approved it. It's just the exchanges that won't list it.
Which is honestly kind of baffling. Because you have twoth social ETFs, you have a one that has ticker GOP. It's just interesting that this is where the line was drawn because I think you can you know, there are some controversial products out there now, so it just seems like this is this is one they don't want to touch.
What's the end around or is there one?
Yeah? Maybe to Eric's point, the name, you know, this one's a little bit too in your face about government drifting.
But is there any other option for him to find a way to list I don't know.
There's one that actually on our team, Andre at Flag the ticker's GOP, which has a lot of the same names, which is just this tracks buys from Republican candidates based on public file.
That GLP ones.
Opportunity, so that one has a lot of the same names that Eric mentioned. Is kind of a backdoor way to get this kind of exposure. But there's also this Texas exchange that is, yeah, might want to stock exchange, they might be open to it. Just says you know, being a little bit more differentiated than some of the other ones that are unwilling to list it.
All right, wonder what ethan? Thanks so much for joining us on Trillions.
Yeah, thanks for having me on.
Thanks for listening to Trillions until next time. You can find us on the Bloomberg terminal, Bloomberg dot com, Apple Podcasts, Spotify, or wherever else you'd like to listen. We'd love to hear from you. Hit us up on social Trillions is produced by Magnus Hendrickson and Kishav Pundia.
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