Author Topic: $BECKY  (Read 940 times)

Castanza

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$BECKY
« on: March 06, 2019, 06:30:35 AM »
Humor

Admittedly, this isn't a completely serious thread but in a way it is. Not sure if anyone here uses Reddit or has been on the sub r/WSB ( WallStreetBets). I'd recommend a visit without the stay as it's complete nonsense and riddled with people making OTM options plays on anything and everything. But every once in a while there is a post that is actually interesting.

Someone on the sub came up with the idea of "creating" their own ETF which tracks the spending of "basic white bitches." Conveniently they named it $BECKY. Their thesis was that rich white girls will always buy the same things. Essentially it's like a cult of status symbols that you "must" have. Turns out the fund does really well with equal weighted holdings. Even the back test results were pretty amazing. It would have been down 58% in 2008, but since the the lowest return was 7%, highest 148%, average was something like 35+% yoy (if I'm remembering correctly). You could probably add a few other brands in there like Target if you wanted. On a serious note, has anyone done investing like this before? Demographic isolation? I remember reading about a guy who invested only in companies with women CEO's because they have an average of 19% higher ROE and a 10% higher div payout than male run companies.

-$ETSY
-$LULU
-$ULTA
-$GOOS
-$SBUX
-$AAPL
-$FB
-$DECK (they make UGGS)


bizaro86

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Re: $BECKY
« Reply #1 on: March 06, 2019, 06:37:12 AM »
That's riddled with hindsight bias, imo. Someone building the same thing 10 years ago wouldn't have had GOOS in it, probably something like crocs instead, if you put in a  few things that flamed out as the "Beckys" of the world went elsewhere the return profile would be very different.

Castanza

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Re: $BECKY
« Reply #2 on: March 06, 2019, 06:52:19 AM »
That's riddled with hindsight bias, imo. Someone building the same thing 10 years ago wouldn't have had GOOS in it, probably something like crocs instead, if you put in a  few things that flamed out as the "Beckys" of the world went elsewhere the return profile would be very different.

No i agree completely! When I back tested it I just removed companies that weren't public and re-allocated funds. Did women ever wear crocs? Again, it's more of a humor post than anything. I wouldn't recommend investing like that.

SHDL

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Re: $BECKY
« Reply #3 on: March 06, 2019, 06:56:09 AM »
There’s probably something to this, though.  I have no data to support this, but my guess would be that all else equal companies that mostly cater to women tend to be undervalued (and therefore outperform as investments) because women are under-represented in the investment world. 

Gregmal

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Re: $BECKY
« Reply #4 on: March 06, 2019, 07:13:30 AM »
So basically there are elements of truth in stereotypes? The liberals must be outraged!

bizaro86

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Re: $BECKY
« Reply #5 on: March 06, 2019, 07:16:32 AM »
If you don't think crocs fit the theme, how about L Brands? Victoria Secret would certainly fit...

It is an interesting thought that female focused companies might outperform.

One of my best performers has been ROST - mostly targets a female shopper (==mom). Run by a (great) female CEO who is super conservative. Their continual low guidance keeps the stock cheaper than it would otherwise be, imo.

Castanza

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Re: $BECKY
« Reply #6 on: March 06, 2019, 07:33:55 AM »
If you don't think crocs fit the theme, how about L Brands? Victoria Secret would certainly fit...

It is an interesting thought that female focused companies might outperform.

One of my best performers has been ROST - mostly targets a female shopper (==mom). Run by a (great) female CEO who is super conservative. Their continual low guidance keeps the stock cheaper than it would otherwise be, imo.

L Brands would certainly fit the bill. Although it has had a rough few years, it's been a good performer with a long term perspective averaging roughly 36% yoy since the late 80's. I'm inclined to believe they will adapt their business model to better suit trends in the industry, but their debt obligations are a concern.  Actually just started another thread regarding it. I'll have to take a look at ROST.

LC

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Re: $BECKY
« Reply #7 on: March 06, 2019, 10:17:21 AM »
Allocate a % of your portfolio to it and let us know how it goes :)

I think if you have particular insight into any demographic then you can do well...the rich/"basic" female demographic may be even easier because it may be underrepresented/underfollowed by mostly-male professional investors. But that is a strong "maybe".
"Lethargy bordering on sloth remains the cornerstone of our investment style."
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