Since its launch last year, the Unusual Whales Democratic ETF, known as “NANC,” has outperformed the broader stock market. With a surge of 30% compared to the S&P 500’s gain of 24%, this ETF has proven to be a successful investment.
The success of the NANC ETF can be attributed to its significant investment in mega-cap tech stocks. Microsoft alone represents nearly 10% of the fund, and the top 10 holdings make up 50% of the fund’s value. Alongside Microsoft, other top tech holdings include Amazon, Apple, Nvidia, Salesforce, and Alphabet. These six stocks combined account for 32% of the fund’s total market value. Additionally, the fund holds other major stocks such as Crowdstrike and Netflix, totaling 719 stocks in its portfolio.
Interestingly, the lawmakers tracked by the NANC ETF also own holdings in the same popular stocks favored by hedge funds. A recent analysis by Goldman Sachs revealed that Amazon, Microsoft, Alphabet, Nvidia, Apple, and Salesforce are among the top 10 most widely owned stocks by major firms. Both the lawmakers and hedge funds aim to capitalize on the market’s best-performing stocks.
In contrast, a Republican-focused fund following a similar methodology, the Unusual Whales Republican ETF (“KRUZ”), has underperformed the market with a gain of approximately 15% since its inception.
It is worth noting that lawmakers trading stocks have faced increased scrutiny in recent years due to concerns about potential conflicts of interest or access to sensitive information. The NANC ETF offers the advantage of tracking these investments, potentially outperforming the market if there is indeed a trading advantage being utilized. However, at present, the fund seems to be employing a straightforward strategy of investing in successful mega-cap tech stocks.
