Why the Buzz ETF is a stock trader’s dream

The poster child of the 2020-20So far the 21st stock market has been Dave Portnoy of Barstool Sports. Portnoy turned fROM a sports player who lovess good pizza and rude jokes in Davey Day Trader, the scourge of prosecution on Wall Street.

His daily videos of him commercial actions has often gone viral. Portnoy understood that with the Fed injecting trillions into the market, most actions would increase most of the time. Portnoy appeared to be taking huge risks and making huge gains.

It was brilliant marketing, even if he was only risking a fraction of his net worth.

Now he’s pushing the influence of social media even further. Portnoy aid launch a brand new ETF called the VanEck ETF Social Sentiment Vectors (NYSEArca: BUZZ).

In the real fashion of bar stools, the video BUZZ announcement was sticky, tasteless, and a lot think may to be the drop of water that forces index providers to register with the SEC for the very first time. Bbut it was effective.

Before you rush to add this ETF to your trading account, let’s see if the juice is worth it …

What is the BUZZ ETF?

BUZZ goes To follow the BUZZ NextGen AI US Sentiment Leaders Index. This index tracks mentions of stocks on social networks and selects the 85 stocks with the best “buzz” at a given time. TheYes use artificial intelligence to follow posts on Twitter, StockTwits, CNBC, and host of other websites To see what stocks everyone is enjoying right now.

Right now, BUZZ has what you might expect. Important positions include Tesla Inc. (NASDAQ: TSLA), DraftKings Inc. (NASDAQ: DKNG), Netflix Inc. (NASDAQ: NFLX), Facebook Inc. (NASDAQ: FB), and Amazon.com Inc. (NASDAQ: AMZN). Ford Motor Co. (NYSE: F) makes the cut like he has been presented as a salvage value and a potential player in the electric vehicle market.

The index returns have been exceptional, with an average annual return of almost 25% over the past five years. In the past year, the performance was also fantastic with gains of over 70%.

Keep in mind, it is the paper trade. The ETF just started trading this month.

The combination of AI and a hot equity portfolio is enough to get people excited about ETF, even outside of the barstool universe.

But should you “join the swarm”, like VanEck suggests, and add BUZZ stocks to your portfolio?

Here’s how to play it …

How to use the BUZZ ETF for the biggest payouts

If you are bullish on stocks, so yes, you should buy as many BUZZs as you can fit in your wallet.

It’s better than long ETFs that are leveraged every day of the week. If the market goes up, then this fund will pave the way. This will own the most popular stocks that attract the buzz and purchasing power of retail and institutional investors.

It will be almost impossible for BUZZ not to outperform the larger indices. This new ETF will only hold the hottest stocks in the index and avoid idiots and stocks that slow down performance.

Another advantage: BUZZ only goes To to buy companies with a market capitalization of $ 5 billion or more. This could help address some of the liquidity issues that can be crippling for ETFs holding thes liquidity issues when we finally see a bear market.

Of course, if you are neutral about the outlook for the markets or are riskydownpour, then you’ll want to skip that ETF.

And meif you‘D bearish on stocks, then the BUZZ ETF is an excellent target for put options, once they are available.

The index results we’ve seen only go back five years, which has been largely a raging bull market. When markets go bad, stocks most popular with small investors could be squashed as institutions begin to dump their stocks to deal with buybacks and buffer themselves against volatility.

There aren’t any options on BUZZ yet, but I think there will be at some point. When that happens, BUZZ could be an options trader’s dream ETF.

Despite all his silliness and rude behavior, Dave Portnoy may have helped introduce one of the best ETFs for a trader’s toolbox for a long time.

Beyond just trading, BUZZ will also be a fantastic tool for investors looking to ride the strongest stocks during a bull market.

If you see Dave Portnoy outside, buy him a slice of pizza.

BUZZ could be one of the most innovative and useful ETFs introduced in a long time.

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