Post-ETFs, a CT Shop Offers More Focus
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Wednesday, April 24, 2019

Post-ETFs, a CT Shop Offers More Focus

After shuttering its ETFs, an ETP startup is now offering investors extremely focused sector exposures. And the team continues to be active in the crypto space, too.

Over the past few weeks, the team at Westport, Connecticut-based REX Shares launched suites of exchange traded notes (ETNs), in partnership with BMO, that focus on "big banks" and "big oil", after rolling out "FANG+" ETNs last year, all under the MicroSectors brand. Watch for more sector ETNs to follow.

"There's a number of sectors that can use disruption," Scott Acheychek, president of REX Shares, tells MFWire. "We're actively looking at different sectors out there

Each MicroShares suite is designed to offer investors "a more direct way of getting that exposure" to that sector. The key, Acheychek says, lies in the ETN structure, which requires only ten names for meeting diversification requirements, allowing the REX Shares team to keep the ETNs' portfolios "more precise and targeted."

"We're allowing people to trade the sector they know with the stocks they follow," Acheychek says.

Within each MicroShares suite, REX Shares offers five different ETNs with different levels of exposure: 3x, 2x, -1x, -2x, and -3x.

REX Shares launched in 2015, and their wares have changed a bit over the years. In 2016 they launched a gold-hedged S&P 500 ETF. "Institutions absolutely loved," Acheychek says, but it never caught on with retail investors. Then last year REX Shares teamed up with Brian Kelly of BKCM on a cryptocurrency- and blockchain-focused ETF.

REX Shares ended up pulling back from its different ETF forays, though they're still involved in the crypto space through their OspreyFunds bitcoin trust product.

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