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The Tidal Financial Group (Tidal) expanded rapidly over the last decade and encompassed multiple ETF related brands including Toroso Investments, Tidal ETF Services, and the ETF Think Tank. Going forward all activity will be unified under the Tidal brand as we become one company, dream, family, and platform focused on holistic ETF customer solutions.

Get Think Tanked Distilled with Stephen Sikes


Investing communities, including WallStreetBets on Reddit, have become a growing trend. Trading transparency is another thing that is being increasingly demanded of money managers. Public, which combines these two themes, has begun gaining traction in the world of investing and Stephen Sikes, the COO of Public, joins the ETF Think Tank to discuss his product and the trends he’s seeing in the marketplace.

What is Public? It’s a platform that Sikes says focuses on helping newer investors build the modern portfolio. Public is a firm that stands for investors, not necessarily traders, and about 90% of those on the platform consider themselves long-term investors. The unique feature is that all trades made on Public are transparent and viewable to all. Public believes that the most important thing is getting people off the sidelines and investing in things that they know, even if it’s just tech or meme stocks, to start. Sikes wants people to explore the full suite of opportunities and let them decide for themselves.

Public’s current user base is a bit of a melting pot, according to Sikes. There are subcommunities focused on things, such as portfolio construction and asset allocation, but there are also others focused more on single stock trading. From novice to experienced, investors can share ideas with each other and learn investing strategies with each other. Sikes describes himself as a pragmatist and wants to focus on making individuals better long-term investors. Public focuses on the long-term investment model and wants to remain aligned with revenue models that incentivized investing, not trading.

Is the goal of Public to have the investing community replace the need for financial advisors? Sikes says not really. He doesn’t want to make individual investors pseudo-advisors, but he does want to make people feel like they’re not going it alone. Retail investors have never had so much information available to them for free and Public tries to provide great research and data to everybody. Sikes wants people to feel like they don’t necessarily need to pay 1-2% a year to someone to give them great exposure to the capital markets.

Other key takeaways:

  • Sikes has found that discussing things with newer investors, such as cost, target returns, minimum drawdowns, industry terms and terminology, can be a big turnoff. They usually just want to learn the basics of how to get started and how to pick a stock. Financial education should come later.
  • What’s the asset breakdown for equities on the Public platform? For the most part, ETFs still haven’t gotten a lot of attention. Most are still single stock investors. For those investing in ETFs, it’s a barbell curve, just like the larger ETF industry. There are big index funds on one end and expensive thematics on the other.
  • Opening a new retail account involves a lot of friction. Investors need to provide bank account information, driver’s license confirmation, proof of address, etc. The thing that gets people over the hump is investing in something they believe in or has a mission behind it.
  • Public just recently purchased Otis, an NFT startup that allows investors access to alternative asset classes and fractional share ownership. Sikes believes that offering investors access to things, such as crypto, art, collectibles and NFTs, gives them the opportunity to build an even broader and more diversified portfolio. It’s a flexible way for Public to bring “interesting” assets on to the platform and Sikes acknowledges that it’s a good hook to pull people off of the sidelines.
Disclosure

All investments involve risk, including possible loss of principal.

The material provided here is for informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision.

All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed.

Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve.

The value of investments and the income from them can go down as well as up and investors may not get back the amounts originally invested, and can be affected by changes in interest rates, in exchange rates, general market conditions, political, social and economic developments and other variable factors. Investment involves risks including but not limited to, possible delays in payments and loss of income or capital. Neither Toroso nor any of its affiliates guarantees any rate of return or the return of capital invested. This commentary material is available for informational purposes only and nothing herein constitutes an offer to sell or a solicitation of an offer to buy any security and nothing herein should be construed as such. All investment strategies and investments involve risk of loss, including the possible loss of all amounts invested, and nothing herein should be construed as a guarantee of any specific outcome or profit.  While we have gathered the information presented herein from sources that we believe to be reliable, we cannot guarantee the accuracy or completeness of the information presented and the information presented should not be relied upon as such. Any opinions expressed herein are our opinions and are current only as of the date of distribution, and are subject to change without notice. We disclaim any obligation to provide revised opinions in the event of changed circumstances.

The information in this material is confidential and proprietary and may not be used other than by the intended user. Neither Toroso or its affiliates or any of their officers or employees of Toroso accepts any liability whatsoever for any loss arising from any use of this material or its contents. This material may not be reproduced, distributed or published without prior written permission from Toroso. Distribution of this material may be restricted in certain jurisdictions. Any persons coming into possession of this material should seek advice for details of and observe such restrictions (if any).

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