Derivatives-enhanced exchange-traded funds have become a hit with retail investors. There’s been more than 160 such launches so far this year, with monikers such as “laddered buffer” and “covered call,” and they’ve attracted $50 billion and counting. While many of the products were designed to protect from downturns, some include options that can generate cash, which comes back to investors in the form of dividends. (Did someone say “yields”?)

On this episode of Trillions, Eric Balchunas and Joel Weber speak with Denitsa Tsekova and Vildana Hajric, Bloomberg cross-asset reporters who wrote a recent feature story about this new retail boom. The group is also joined by Todd Akin, a retail trader behind the Unconventional Wealth Ideas YouTube channel and one of the characters in their story. They discuss why these ETFs have become so popular, how they work—and what the risks are.

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A new competition has begun to see who can successfully solve an investing paradox: how to package illiquid, private assets into liquid, public exchange-traded funds. State Street, in partnership with Apollo, officially kicked off this race with a recent filing. If approved, their offering would make one of Wall Street's fastest-growing corners—private credit—open to a much wider world than just institutional investors.

On this episode of Trillions, Eric Balchunas and Joel Weber speak with Vildana Hajric, a cross-asset reporter at Bloomberg News, about the details of the filing, why more filings are expected, what to know about Apollo’s “liquidity backstop” and why all of this is such a potential game-changer.

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For every stock that enters an index like the S&P 500 or Russell 1000, another must exit. One might assume these “deletions” are a sorrowful bunch whose demotion to the B-team means they’re no longer worthy of your portfolio. Yet Rob Arnott, founder of Research Affiliates and a longtime champion of “smart beta,” discovered that many of these rejects tend to perform better after being dropped from the indexes.

On this episode, Eric and Joel speak with Arnott about his new exchange-traded fund, $NIXT, which holds dozens of such stocks with equal-weighting. They discuss how the ETF—Arnott’s first launch—may complement your portfolio, what’s behind the performance, how the portfolio rebalances and why smart beta has endured.

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