A new exchange-traded fund (ETF) that tracks an index ranking the top 75 stocks the internet is most bullish towards began trading on Thursday, arriving just in time as Wall Street begins to recover and process the mega GameStop
The VanEck Vectors Social Sentiment ETF
Stocks on the index must meet two criteria: be a U.S. stock with a market capitalization of $5 billion or more and get consistent and diverse mentions on social media throughout the past year, according the passively managed ETF's guideline. The stocks that qualify are then ranked each month from highest to lowest sentiment using artificial intelligence, with the top 75 making it into the index for that period.
This is not meant to be a "meme stock" ETF that follows the latest stock craze that r/WallStreetBets is riding. In order to bring broader user bases, the index's AI examines millions of social media and internet posts from platforms like Twitter
Initially, the largest holdings the ETF include DraftKings
The $5 billion market cap minimum keeps "meme stocks" like GameStop or AMC Entertainment
Internet celebrity and founder of Barstool Sports Dave Portnoy is part owner of Buzz Holdings, which in turn owns that index BUZZ follows. Portnoy has become a popular day trader to follow over the past year as the coronavirus pandemic impacted sports betting, with Portnoy sharing daily his wins and losses on social media and YouTube
For some investors, BUZZ might be an interesting alternative to other technology ETFs, such as Vanguard Information Technology ETF