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Brian Jacobs @jacobsbrian.bsky.social · 12/12/2024

Enter structured (i.e. return stacked) ETFs. These innovative products combine alpha generation, market beta, and sometimes leverage, all within a tax-efficient wrapper. Think about layering the Eurekahedge Hedge Fund Index’s returns on top of core market beta.

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Brian Jacobs @jacobsbrian.bsky.social · 12/12/2024

This isn’t a one-off story. The Eurekahedge Hedge Fund Index, tracking 3,000+ funds, has underperformed the S&P 500 by over 7% per year over the past decade. The result? Underperformance + higher taxes + hefty fees = frustrated investors.

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Brian Jacobs @jacobsbrian.bsky.social · 12/12/2024

Blog Post: ETFs as Hedge Funds 2.0: A Better Way to Capture Beta and Alpha? Hedge funds often fall short. Case in point: Warren Buffett’s 2007 bet. He wagered $1M that an S&P 500 index fund would beat a selection of hedge funds over a decade. The S&P 500 crushed all five hedge fund portfolios.

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Brian Jacobs @jacobsbrian.bsky.social · 04/12/2024

More a reflection of Greece's improved standing than France's deterioration (at this point at least), but this wasn't an outcome that would have been deemed possible a decade ago

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Brian Jacobs @jacobsbrian.bsky.social · 04/12/2024

3) CAPE cannot be compared across markets US Fundamentals have simply been better. If a market grows EPS by 10% annually, CAPE rises even if the trailing P/E stays constant. Meanwhile, a market with flat or negative EPS growth could look "cheaper" on CAPE despite weaker fundamentals.

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Brian Jacobs @jacobsbrian.bsky.social · 04/12/2024

2) CAPE ignores the impact of buybacks, which boost EPS by reducing share counts. CAPE ignores the impact of buybacks, which boost EPS by reducing share counts. Two identical companies: A: Pays dividends B: Does buybacks CAPE values B as "more expensive," even if their businesses are identical.

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Brian Jacobs @jacobsbrian.bsky.social · 04/12/2024

1) The U.S. market has evolved dramatically CAPE’s numerator reflects CURRENT market caps of today’s leaders, but the denominator uses decade-old EPS when those stocks were much smaller. Example: NVDA price now reflects massive growth, but CAPE uses earnings from when it was 0.06% of the index.

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Brian Jacobs @jacobsbrian.bsky.social · 04/12/2024

The CAPE ratio, introduced by Robert Shiller in 1988, is a popular tool for assessing market valuation. But its track record shows consistent underestimation of U.S. equity returns—missing by 5-10%+ over many periods. aptuscapitaladvisors.com/beware-cape-... Let’s explore.

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Brian Jacobs @jacobsbrian.bsky.social · 01/12/2024

Well… that was fun! Last week I was fortunate to be on @bloomberg ETF IQ to talk about our new ETF $UPSD You can find me starting at the 17:00 minute mark: lnkd.in/ghY-_Ag2 Feel free to DM with any questions

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Brian Jacobs @jacobsbrian.bsky.social · 26/11/2024

But… while not cheap (by any measure) prices and even mortgage payments aren’t nearly the outlier relative to disposable income. What has changed is they aren’t historically cheap like they were even a few short years ago. Full post: aptuscapitaladvisors.com/housing-mark...

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Brian Jacobs @jacobsbrian.bsky.social · 26/11/2024

Housing Market and Affordability… 1/2 Home prices and especially mortgage payments (given prices and rates) are clearly elevated in nominal and real terms

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Brian Jacobs @jacobsbrian.bsky.social · 25/11/2024

Some last minute “stimulus” before budgets get pulled 👀

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Brian Jacobs @jacobsbrian.bsky.social · 25/11/2024

We see a lot of charts showing the outperformance of U.S. vs foreign stocks as some indication that mean reversion is on the way. If earnings growth doesn’t revert, returns won’t either.

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Brian Jacobs @jacobsbrian.bsky.social · 25/11/2024

You mean with unemployment at ~4% we weren’t in a worse situation than GFC lows?

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Brian Jacobs @jacobsbrian.bsky.social · 25/11/2024

S&P 500 next month returns when the VIX curve is “normal” have been higher and lower risk. Check out the full blog post outlining how an investor may take advantage. aptuscapitaladvisors.com/utilizing-vo...

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Brian Jacobs @jacobsbrian.bsky.social · 25/11/2024

Sometimes the VIX curve is like this… downward sloping as near term fears are elevated (in backwardation) such as during the GFC

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Brian Jacobs @jacobsbrian.bsky.social · 25/11/2024

Sometimes the VIX futures curve is like this… upward sloping (in contango) signaling market risk is “normal” HT vixcentral.com

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Brian Jacobs @jacobsbrian.bsky.social · 15/11/2024

The takeaway: The VIX term structure isn’t just a chart—it’s a tool. Using it effectively helps navigate uncertainty with clarity and purpose.

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Brian Jacobs @jacobsbrian.bsky.social · 15/11/2024

By understanding how expectations for volatility change over time, we can align our risk-taking with the market’s evolving outlook.

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Brian Jacobs @jacobsbrian.bsky.social · 15/11/2024

The VIX term structure typically slopes upward—longer-term volatility is expected to be higher. But when markets panic, the curve inverts, signaling near-term fear. This shift can guide decisions on risk allocation. Source: vixcentral.com

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