00:00And it's time to take a look at the Bloomberg Intelligence Traffic Light System, which ranks
00:03ETFs by risk levels. Now, green light means low risk, yellow light means moderate risk,
00:08and red light, as you might imagine, means high risk. So let's take a look now with Eric
00:14Balchunas. I believe you're looking at the ticker BWET. Tell me about it.
00:19Yeah, we called an audible today on this morning on the train ride in. We have to cover this one.
00:24We were going to do South Korea, but this is way more important. This thing's up 25% today,
00:28Katie. If there was an ETF perfectly positioned for this situation that just happened, it's this
00:34one. However, it's a red light for a couple of reasons. First of all, it tracks futures. Now,
00:39it tracks futures for transporting crude oil from the Middle East to the Americas and Asia. So
00:44obviously, this is the place in the middle of the action right now. It's also been up a lot. So
00:49it's up 250% year to date and 500% over the past year. The reason it gets a red
00:56light, though,
00:56is when you roll futures, you can sometimes pay more for the next one if it's in contango. And
01:01that's a cost that most people don't understand. However, sometimes you get the opposite, where the
01:06curve goes down and you actually make money rolling. And that's what this is in right now.
01:11It's in backwardation. So you actually get paid to roll, but that's not the norm. So that's why
01:16it gets red. Also, the percent premium has been elevated because there's a lot of trading and it's
01:19not that liquid. And it also doesn't track the index that well because it is in backwardation.
01:24So it's a very quirky ETF. However, it's up a ton and it's going to get some looks today.
01:29The volumes already triple the old record. Yeah, it's always interesting to take a look at these,
01:34you know, futures based ETFs, especially when it comes sort of to commodities. So it's complex and
01:40it's it's interesting to take a look at the flows, because even though with that performance,
01:45certainly some eye popping figures there, it hasn't necessarily translated into mega inflows here.
01:51This is a shiny object moment for sure. But I just don't see this sweeping the country.
01:55OK, the break wave, you know, shipping futures. It's just a little too niche, sort of like wheat
02:02and corn. Now, oil, XLE, I can see action, maybe U.S. So those tend to be the ones that
02:07my,
02:08you know, roommates from college will text me about. They're probably not going to be in the
02:12B-Wet. This is probably for really hardcore traders or maybe some digens who see the price
02:16action. I don't see it growing that much, but it certainly will grow. It will get more looks
02:21with these returns.
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