New Exponential Technology ETF: What Does It Mean for You?
Ric Edelman: Big news last week. You have heard me talking for years on this radio show and a lot of conversation particularly in the past year or two about the growing field of exponential technologies. It’s a focus of my weekly television show airing on public television stations around the country. It’s a focus of our monthly newsletter.
I have been very, very involved in the study of exponential technologies for quite a long time. I graduated back in 2012 from the executive program of Singularity University where I subsequently was invited to become a guest lecturer and now I’m an investor in the university as well.
And I’ve been speaking around the country over the past couple of years to industry groups – Barron’s and the Tiburon CEO Summit and TD Ameritrade, the Inside ETF Conference, Financial Advisor Magazine and others – trying to share with the financial advisors and the investment community the incredible impact of exponential technologies and how it’s going to alter not only the advice we deliver to our clients but how we deliver that advice.
And one of the things that has stymied me, as you know from listening to these broadcasts over the past couple of years, is the fact that ordinary investors – people like you and me – have not had access to investment opportunities in the exponential technologies arena. And so we’ve been very frustrated over the fact that there hasn’t been anything available and so we’ve searched the investment landscape and found that there were no exchange-traded funds, no ETFs, no stock mutual funds that had a proper focus of exponential technologies.
And I’m talking about the categories of big data and analytics, nanotechnology, medicine and neuroscience, networks and computer systems, energy and environmental systems, robotics, 3-D printing, bioinformatics and financial services information.
We couldn’t find a fund that provided in a cost-effective, effectively structured way an opportunity to do this. And so I’m happy to announce that last week BlackRock launched the iShares Exponential Technologies ETF.
We’re very pleased with this. According to the press stories that have been released – and there have been a lot of them – this ETF was inspired by me and Edelman Financial Services. I asked BlackRock to construct the ETF – to create it – they turned to Morningstar which built an index called The Morningstar Exponential Technologies Index and it is serving as the basis for the ETF that BlackRock has launched.
There is no financial relationship, there’s no financial involvement with my firm or with me and BlackRock. We are not being compensated in any way regarding this ETF: it is simply that we wanted to provide our clients an opportunity to have exposure in their globally diversified portfolios to these types of companies on a global basis that are either developing these technologies or, equally important, using these technologies in the growth and development of their companies.
And so it is completely arms-length. As fiduciaries we are compensated solely by our clients and we aren’t receiving third-party payments for this ETF or there’s no relationship in that regard with us and BlackRock or with Morningstar, and it is open-sourced: this ETF is an ETF just like all of the other iShares ETFs; it’s available to any investor anywhere. You don’t have to come to Edelman Financial – although quite frankly I would like you to – you don’t have to do that: you can go to your own financial advisor, you can go directly to any discount brokerage firm, you can buy this directly on your own or anywhere else. And so we’re very excited that the ETF has been launched.
We have already placed our clients into the ETF – those, I should say, of our clients who we believe the ETF is appropriate for their
portfolios: so not every client of our firm received it – but those for whom we believe it was appropriate and in the client’s best interest we added it to the portfolios last week, and so we’re very excited about that.
Along the lines – it’s really interesting – it has gotten a lot of play. The launch of the ETF was featured in The Wall Street Journal. Investment News. Market Watch. Financial Advisor. Wealth Management and others – and as you know every week I bring to you the latest news in the field of exponential technologies. And here is some of the latest news.
In Japan the Henn-na Hotel has announced that they will soon be opening and it will be staffed by androids.
Yeah, androids. Androids are going to work the reception desk, they will be waiters, they will be the cleaning staff and the cloakroom attendants. The androids were developed by Japan’s Osaka University. The robots resemble a young Japanese woman who speaks Japanese, Chinese, Korean and English, makes hand gestures and mimics eye movements.
The room rates start (what’s the price?) the room rates start at $60.00. Now, you’re probably thinking I was going to say $6,000.00, right? No, no, no. The whole point of robotics is that they’re cheaper than humans. The robots never call in sick, they don’t go on strike, they don’t take cigarette breaks, they don’t have a bad day and yell at customers, they don’t drop dishes on the way from the kitchen to the table and they’re less expensive to boot; so that is reflected in the price of the hotel rooms: $60.00, which is about a third of the cost of staying in a hotel in the neighborhood in Japan where this hotel is soon going to be opening. So that’s one of the latest ideas.
Here’s another one. Skillshare. Now you’ve heard me talk often about MOOCs – Massively Open Online Courses: the ability for you to take classes online. MIT has all of its classes online for free. Skillshare is another online site that allows you to determine the courses that you want to teach, not merely to take. This is the spin that Skillshare is doing.
They offer right now over a thousand courses that cost $10.00 a piece. They have over 850,000 students from around the world who participate in the educational classes offered by Skillshare – many of these people – often thousands of them – signup for a single course.
Here’s the key: you can decide to teach a course on any subject you want at no cost. Skillshare will set you up with their technology, you can teach the course of your choice – it could be any subject in the world that you want – if 25 people or more attend your class Skillshare will pay you. Under 25 people you don’t get paid. But if you have a course that is popular – word of mouth grows and you get a good reputation of being a good teacher on whatever the subject matter happens to be: they’ll pay you.
They’ve had 1,200 people sign up for their digital visual effects class. They have 2,000 who signed up for the visual storytelling class. Anybody can now not only get an education online: they can now give an education online.
Pretty cool stuff: all of it from the area of exponential technologies. If you would like to understand more about this and wonder does this fit in with your own investment portfolio, how best to fit it in with your investment portfolio, give us a call; that’s what our financial advisors are all about: helping you understand what your investment portfolio ought to look like, how can it be designed properly to achieve your financial goals over the next 5, 10, 20 years and even longer.Source: www.edelmanfinancial.com