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new index ETF
Old 08-17-2022, 09:24 AM   #1
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new index ETF

I would like to get opinions on the new ETF(ticker DRLL) as an investment going forward. It's expense ratio is high for an index ETF.



Thanks for any replies.
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Old 08-17-2022, 09:25 AM   #2
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Thread moved to correct forum.
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Old 08-17-2022, 09:36 AM   #3
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Interesting investment strategy:

Quote:
Backers Peter Thiel and Bill Ackman have sought to create an ETF [DRLL] with the purpose of promoting energy investment like more drilling. They want to push back against environmental, social and governance (or ESG) mandates which reward oil companies for lowering production.
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Old 08-17-2022, 10:50 AM   #4
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new index ETF

What is the index for this?
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Old 08-17-2022, 10:57 AM   #5
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Looks similar to XLE, an ETF that invests in energy companies. Expense ratio for DRLL (0.43%) is 4x that of XLE (0.1%)
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Old 08-17-2022, 10:57 AM   #6
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I'm all for ETF's. I even like energy. This one has 1000 companies. .41 expense ratio is a bit high for me. I would go with VDE, .10 expense ratio.
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Old 08-17-2022, 11:28 AM   #7
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The impression I got when skimming through their material is that this is more of a "political" statement than an investment. There are a few wrinkles between it & its competitors in the energy space, but none that struck me as significant.

That said, without regard to whether or not the asset space is a good investment going forward, I wouldn't take this as the vehicle. Note the small size of the fund. Means liquidity will be low, wide spreads. Coupled with the drag of expense ratio, I doubt the etf will get traction. Sometime down the road, it will be dissolved. Not meaning your investment will go to nothing, but that assets sold off & you'll get your "nav".

Why bother? If you want to support their message, have at it. Will cost a little, but not disaster. Happy investing -- let us know what you decide.
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Old 08-17-2022, 12:02 PM   #8
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Here is their deal: typical fund managers vote your shares ignoring your wishes and they may simply kow-tow to big institutional owners. Idea here is to focus on investing, not politics or ESG since those metrics are not tied to long-term investment success.

It makes sense I think. I expect as the fund grows larger, expenses will come down.
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Old 08-19-2022, 11:56 AM   #9
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Most of the top 10 holdings are the same as XLE. Not sure what warrants a 4x higher ER
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Old 08-19-2022, 04:18 PM   #10
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Originally Posted by madatrub View Post
Most of the top 10 holdings are the same as XLE. Not sure what warrants a 4x higher ER
So perhaps emulate by buying XLE and shorting a few of the XLE members that are not in DRLL.
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Old 08-19-2022, 05:29 PM   #11
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Originally Posted by copyright1997reloaded View Post
So perhaps emulate by buying XLE and shorting a few of the XLE members that are not in DRLL.
Maybe. Its marketing itself as the Anti-ESG Energy ETF, but if the top 10 weightings are all the same, whats it really accomplishing? And I work in the field and know for a fact that some of those in the top 10 are certainly bought into the ESG stuff.
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