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08-17-2022, 09:24 AM
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#1
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Recycles dryer sheets
Join Date: Oct 2010
Location: Columbus
Posts: 164
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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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08-17-2022, 09:25 AM
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#2
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Moderator
Join Date: Feb 2010
Location: Flyover country
Posts: 25,357
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Thread moved to correct forum.
__________________
I thought growing old would take longer.
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08-17-2022, 09:36 AM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,021
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Interesting investment strategy:
 Quote:
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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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__________________
Numbers is hard
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08-17-2022, 10:50 AM
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#4
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Aug 2004
Location: Laurel, MD
Posts: 8,327
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new index ETF
What is the index for this?
__________________
...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
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08-17-2022, 10:57 AM
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#5
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Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,717
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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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08-17-2022, 10:57 AM
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#6
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Thinks s/he gets paid by the post
Join Date: Oct 2014
Posts: 1,544
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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.
__________________
-Big Dawg-FI since 9/2010. Failed ER in 2015. 2/15/2023=DONE! "Blow that dough"-Robbie
" People say I'm lazy, dreaming my life away Well, they give me all kinds of advice designed to enlighten me When I tell them that I'm doing fine watching shadows on the wall "Don't you miss the big time, boy. You're no longer on the ball" -John Lennon-
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08-17-2022, 11:28 AM
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#7
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Recycles dryer sheets
Join Date: Sep 2021
Posts: 199
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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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08-17-2022, 12:02 PM
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#8
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Aug 2016
Location: Northern Virginia
Posts: 7,591
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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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08-19-2022, 11:56 AM
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#9
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Recycles dryer sheets
Join Date: May 2008
Posts: 271
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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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08-19-2022, 04:18 PM
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#10
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Thinks s/he gets paid by the post
Join Date: Feb 2007
Location: Upstate
Posts: 2,951
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Quote:
Originally Posted by madatrub
Most of the top 10 holdings are the same as XLE. Not sure what warrants a 4x higher ER
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So perhaps emulate by buying XLE and shorting a few of the XLE members that are not in DRLL.
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08-19-2022, 05:29 PM
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#11
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Recycles dryer sheets
Join Date: May 2008
Posts: 271
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Quote:
Originally Posted by copyright1997reloaded
So perhaps emulate by buying XLE and shorting a few of the XLE members that are not in DRLL.
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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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