Dave Portnoy is promoting a new exchange-traded fund (ETF) focused on stocks with positive shareholder sentiment that is set to debut Thursday on the New York Stock Exchange
Portnoy, the founder of popular sports and pop culture website Barstool Sports, has partnered with the makers of the VanEck Social Sentiment ETF (BUZZ) to launch the new investment vehicle. Portnoy became a day-trading phenom over the past year as the COVID-19 pandemic forced sports betting to pause. He translated his notoriety with sports bettors to day traders, sharing his trading wins and losses every day on social media and YouTube.
BUZZ will invest in the 75 stocks worth at least $5 billion receiving the most positive sentiment on the Internet and social media by using artificial intelligence to search the web for mentions. Specifically, the ETF’s algorithm monitors 15 million posts a month to measure which stocks have the most positive investor sentiment based on online chatter. Then it ranks the top 75 stocks in the BUZZ NextGen AI US Sentiment Leaders Index.
Online sentiment has driven unprecedented volumes of trading so far this year. The chatter, led by retail investors and day traders, has rallied so-called meme stocks like GameStop (GME) and AMC Entertainment (AMC) to new heights. The latest target of online forums like Reddit’s WallStreetBets has been Rocket Companies (RKT), which popped 71% Tuesday.
Portnoy, who was given an ownership stake in BUZZ, said the algorithm was built five years ago. In 2020, the Buzz index outperformed the S&P 500 by 40%, he said.
Some of the top holdings in BUZZ include Twitter, Tesla, Draft Kings, Virgin Galactic, Advanced Micro Devices, Plug Power, Ford, Novavax, Facebook, Amazon, and Apple. Ninety percent of the holdings in BUZZ are in the following five sectors: tech, consumer discretionary, communication services, health care, and industrials.