- A new
ETF fromNancy Davis is betting ondeflation ahead, cutting against a market consensus fixated on rising prices. - BNDD is a bet on Japanification - the fund should gain most if a low-growth, low-rates regime comes to US.
- The options portion of the ETF promises exposure to interest rate derivatives not often available to retail investors.
A new ETF from influential hedge fund manager Nancy Davis is betting on deflation in the near term, cutting against a market consensus that has spent months fretting over rising prices.
The Quadratic Deflation ETF, run by Davis herself, will hold long-dated Treasuries as well as a mix of options, Quadratic Capital Management said in a statement. The fund has an expense ratio just under 1%.
Trading under the ticker BNDD, the ETF is explicitly a bet on Japanification - that is, the fund should gain most if a low-growth, low-rates regime comes to America.
"Some investors have expressed concerns that the US will experience an environment similar to
The company is also pitching investors on a democratization angle. The options portion of the deflation ETF promises exposure to rarer over-the-counter interest rate derivatives not often available to retail investors.
Davis made headlines in January when her $4 in assets under management, in a clear signal of investor fear. Her swift rise to prominence led Insider to put Davis on our $4 for North America.
But while Davis is now getting involved in betting on deflation, the conventional wisdom on future prices has remained much the same.
In fact, a Citi survey of big family offices and ultra-rich individual investors released on Tuesday found that 30% put