Van Eck’s new BUZZ ETF to track social media chatter
A new ETF that tracks an index ranking the top 75 stocks each month that display the highest degree of “positive investor sentiment” as gauged by the monitoring of 15 million online posts will begin to trade on Thursday under the symbol BUZZ.
The VanEck Vectors Social Sentiment ETF will be listed on the New York Stock Exchange and will invest 80% of its funds based on the BUZZ NextGen AI U.S. Sentiment Leaders Index, according to a prospectus for the passively managed ETF.
The rankings in the index are selected and scored using artificial intelligence to examine millions of data points that have been aggregated from social media, news reports and blogs, according to BUZZ Holdings ULC.
Social media and mobile technology have fundamentally changed the way people engage with stocks, BUZZ Holdings’ website investwithbuzz.com said. Monitoring social media allows BUZZ Holdings to gain actionable insights to inform its stock selection, it said.
“There’s a ton of online chatter every day,” the website said. “Don’t sleep on this.”
The BUZZ index is up 78.88% over the past year ending March 2, compared to a 25.24% gain in the benchmark S&P 500 index.
Stocks in the BUZZ index as of Jan. 31 had a weighted average market capitalization of $297.2 billion, the prospectus said, suggesting it was heavily weighted to the big tech stocks that fueled the record rally this past year on Wall Street.
Shares in so-called meme stocks favored by retail traders on social media have gained enormous attention this year after more than a six-fold increase in the value of GameStop Corp in less than a week in January, and the stock’s subsequent plunge.