Learn How $NANC And $KRUZ Can Help You Trade The Same Way Congress Does!

Benzinga

Mike Venuto, co-founder and CIO of Tidal Financial Group, was recently interviewed by Benzinga about Subversive ETFs and its Unusual Whales Democratic ETF. Given their knowledge of active geopolitics and ability to make policy, congressional members may be able to make smarter trades than members of the public. For investors who wish to use this information to their advantage, these ETFs make the same investments as their respective members of Congress using data obtained from the STOCK Act, which requires the disclosure of trades by Congress.

Transcript

00:00Hey, Zingers, it's Dan Leach, and I am so pleased to be joined by Mike Venuto, the co-founder

00:07and CIO of Tidal Financial Group.

00:09Great to see you, Mike.

00:10Great to talk to you and your audience, Dan.

00:12Hey, it's exciting to have you here, and I want to talk about, you know, the fact you

00:15offer two ETFs, NANC and KRUZ, that track the trading patterns of Congress.

00:23Why is that a good strategy?

00:25Yeah, so I work for a company, or co-founded a company called Tidal Financial Group, and

00:31we help people launch and grow ETFs.

00:34In these two, we're working with a company called Subversive that's partnered with Unusual

00:39Whales, the very well-known Twitter account.

00:42And the essential concept of these two ETFs is to take the information that congressional

00:49members, you know, congressmen and women and Senate participants, whenever they get

00:55information or are on a committee or happen to know something that maybe the rest of us

01:01don't know, unlike somebody in the world of finance, they're legally allowed to act on

01:07that, as long as they disclose it within 45 days.

01:12So the concept here is to take that information that they're using to profit and put it into

01:18two different funds, one that tracks the ideas or investments of the Democratic Congress

01:26folks, that's ticker NANC for Nancy.

01:29You can take that to the next level if you want.

01:32And the other tracks the congressional members of the Republican Party, which is ticker KRUZ

01:39for Cruz.

01:40Yeah, you can take that to the next level as well, on both sides, absolutely fascinating

01:44stuff.

01:45So Michael, what are the key distinctions between the two in regard to the investing

01:50themes?

01:51How does this reflect the worldviews of both the different parties?

01:54Yeah, it's strange because the worldviews and political statements don't necessarily

02:00match up 100% with their investment goals, right?

02:05Their investment goals are to make money.

02:08So what you do see is the leadership roles that they tend to have on certain committees,

02:17is pushing them towards one side or the other.

02:20There's without a doubt a higher, call it tech approach in the Democratic trades, and

02:27there's a higher energy and financial services in the Republican trades, even though tech

02:33is still the largest portion of the portfolio.

02:37Now you alluded to this, why is this legal and do you think there is a chance that could

02:42change?

02:43I don't think there's a chance that they will stop this.

02:47It's rare that Congress will do something to hurt themselves.

02:51However, I do think that it's likely that there'll be eventually some bipartisanship

02:57support for maybe making the rules a little bit stronger, right?

03:02There's not a lot of fines or real action that makes it so they have to disclose on

03:08a timely basis and things like that.

03:11The fine is like a thousand dollars, right?

03:14It's more getting shamed by our partners at Unusual Whales is more damaging than the thousand

03:20dollar fine.

03:21So I could see them increasing the fine or decreasing the amount of time they have to

03:27report it.

03:28The beautiful thing is all of those things would make our data better and our ability

03:33for Dan Weisskopf and I to manage this fund better because the information will come to

03:37us quicker.

03:38I love it.

03:39And speaking of that, how do you receive this data and how does it manifest in those portfolio

03:43decisions?

03:44Yeah.

03:45So this is public data.

03:47Now it's also gobbledygook when you go to the public websites and try and get it.

03:51So our partners at Unusual Whales, they're the ones that really partial through the data,

03:57put it into things where we can slice and dice, see patterns, see groups of specific

04:04people doing things, really get rid of the noise, right?

04:08Some of these Congress members, they just go hire a broker to do some direct indexing

04:12for them or buy everything.

04:14We don't want to buy everything.

04:15We want to buy the things that it looks like they either came out of a committee meeting

04:20or three of them bought similar things on the same day or across the board, they're

04:26all seem to be selling the same thing.

04:28So that data, taking it from the gobbledygook that's on the public websites, filtering it

04:35through the Unusual Whales, basically software and data collection.

04:40And then Dan Weiskoff and I taking the time to interpret it and understand it and build

04:45a portfolio that hopefully allows investors to profit the same way Nancy Pelosi does or

04:53Ted Cruz does.

04:54Yeah, who doesn't want to be on equal footing as the people like them that are profiting?

04:57And Mike, it's no secret crypto has become a political issue.

05:01Does it have an impact on either of these portfolios?

05:04So they're required to disclose their crypto holdings.

05:09A lot of them, you'd be surprised, do have them.

05:11And it's also probably not a surprise that it seems to be more on the Republican side.

05:16I know there was a lot of stories when JD Vance was picked as Trump's running mate that

05:20he owned it.

05:22As of right now, we do not have crypto in there, but we are working on some ways because

05:27none of them own the crypto stocks.

05:30And right now, we don't own any ETFs in the portfolio either, but we are looking at it

05:35and trying to find ways to get that exposure if it does become a meaningful portion of

05:41what congressional members are investing in.

05:44Mike Venuto, the co-founder and CIO of Tidal Financial Group.

05:48Absolutely fascinating conversation.

05:50Thank you so much for joining me today.

05:52Thank you, Dan.

05:53Thank you, Benzinga listeners.

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