VanEck resurrects Social Media Buzz ETF

VanEck Vectors Social Sentiment ETF

Ticker: BUZZ

Effective date: February 23, 2021

Listing date: March 4, 2021

Expense ratio: 0.75%

The underlying index for this fund was originally named the "BUZZ Social Media Insights Index". It was eventually renamed the "BUZZ NextGen AI US Sentiment Leaders Index™".

An ETF tracking the index was launched in April 2016 under the name 

"Sprott BUZZ Social Media Insights ETF (NYSE: BUZ)", but BUZ was shuttered in 2019.

Last week VanEck filed for an ETF that tracks this same index and named the fund the "VanEck Vectors Social Sentiment ETF". The index contains 75 stocks of US companies picked based on their Insight Score, a measure arrived at with proprietary dark sorcery black box Artificial Intelligence and which indicates which stocks have social media "buzz".

The idea behind "buzz" is to harness the wisdom of the crowds and to anticipate stock price trends by observing the information/interest around stocks being generated in social media, and the individuals mentioning them.

Both the classification of social media mention (positive, negative, neutral) and the weight of the individual mentioning the stock are vulnerable to subjective settings in developing the AI used to score stocks.

However, over the 717 trading sessions over which BUZ was alive, it outperformed SPY by about 5%. Let's see how it fares now as "BUZZ" and under the management of VanEck.

Finally, BUZ charged a 0.75% expense ratio, so will be interesting to watch where VanEck prices BUZZ.

Index: BUZZ NextGen AI US Sentiment Leaders Index

Index provider: BUZZ Indexes

Constituents: 75

Strategy/Index Methodology

The BUZZ NextGen AI US Sentiment Leaders Index™ identifies the 75 large cap US stocks which exhibit the highest degree of positive investor sentiment and bullish perception. 

The insights are statistically derived using machine learning and artificial intelligence analysis techniques applied to millions of unique stock-specific data points. 

Content is aggregated from online sources including social media, news articles, blog posts and other alternative datasets.

The data is filtered through an analytics model which utilizes Natural Language Processing Algorithms and Artificial Intelligence Applications.

The BUZZ Process

1. From universe of US stocks BUZZ targets most mentioned across online sources including social media, news, and blogs

2. BUZZ classifies mentions as positive, negative, or neutral

3. BUZZ measures influence and historical accuracy of individuals mentioned aforementioned stocks

4. Stocks are assigned an "Insights Score"

5. 75 stocks with highest "Insight Score" are selected for index

6. Rebalanced monthly

Index Constituents as of November 23, 2020 in descending order of weight:

1. Plug Power Inc.
2. Snap Inc.
3. Peloton Interactive Inc.
4. Tesla Inc.
5. Fastly Inc.
6. Zoom Video Communications Inc.
7. Twitter Inc.
8. Boeing Co.
9. Advanced Micro Devices Inc.
10. Amazon.com Inc.
11. Facebook Inc.
12. Apple Inc.
13. Netflix Inc.
14. Microsoft Corp.
15. Pfizer Inc.
16. Pinterest Inc.
17. General Electric Co.
18. American Airlines Group Inc.
19. Walt Disney Co.
20. Gilead Sciences Inc.
21. Roku Inc.
22. Square Inc.
23. Beyond Meat Inc.
24. Alphabet Inc.
25. Novavax Inc.
26. Intel Corp.
27. PayPal Holdings Inc.
28. Carnival Corp.
29. Ford Motor Co.
30. AT&T Inc.
31. NVIDIA Corp.
32. Moderna Inc.
33. Canopy Growth Corp.
34. JPMorgan Chase & Co.
35. Cloudflare Inc.
36. Uber Technologies Inc.
37. Teladoc Health Inc.
38. The Goldman Sachs Group Inc.
39. Exxon Mobil Corp.
40. General Motors Co.
41. Biogen Inc.
42. Shopify Inc.
43. Wells Fargo & Co.
44. Hyatt Hotels Corp.
45. Barrick Gold Corp.
46. Wal-Mart Stores Inc.
47. Twilio Inc.
48. Enphase Energy Inc.
49. Bank of America Corp.
50. Etsy Inc.
51. Datadog Inc.
52. Slack Technologies Inc.
53. Trade Desk Inc.
54. International Business Machine
55. Penn National Gaming Inc.
56. Simon Property Group Inc.
57. Johnson & Johnson
58. Chewy Inc.
59. Occidental Petroleum Corp.
60. Citigroup Inc.
61. Morgan Stanley
62. QUALCOMM Inc.
63. DocuSign Inc.
64. United Parcel Service Inc.
65. Crowdstrike Holdings Inc.
66. United Airlines Holdings Inc.
67. Lyft Inc.
68. Regeneron Pharmaceuticals Inc.
69. Zendesk Inc.
70. Activision Blizzard Inc.
71. CVS Health Corp.
72. Eli Lilly and Co.
73. McDonald’s Corp.
74. Starbucks Corp.
75. Delta Air Lines Inc.

BUZZ fund holdings can be found here.

Prospectus is here.

Index being calculated by Solactive:

Index guidelines (doesn't contain any information on the AI methodology: how do they expect anyone to replicate/track/verify the index?)

Bonus: The original Sprott BUZZ Social Media Insights ETF.

HEARSAY on Social Media

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