00:00As Eric was saying Elfie was launched about a year ago. So this is something that you kind of planned
00:06for. What was the thinking at the time in the first quarter of 2025 when you were putting together the
00:11prospectus for this ETF. So the guy who designed the index Mark McLean's in utility finance over at Ladenburg Thalman.
00:17He's been in the category for 2025 years and he actually came up with the index methodology before the AI
00:22data center explosion and the ramp up in electricity demand coming from it. He put it together in advance of
00:28or in response to the
00:29renewable portfolio standards that a lot of states adopted when we got out of the Paris Accord. And so this
00:34forced spending on renewables decommissioning of fossil fuel oriented electricity generation meant that there was going to be a ramp
00:42up in infrastructure investment. And now you add AI data centers and reshoring. You start piling on all of these
00:48different drivers of electricity demand. And we felt it was additive to a portfolio context. Let's talk about the waiting
00:55equal waiting. Right. This is an interesting thing. So thematic
00:59ETFs if you equal weight them you have more love for the small stocks which can get acquired. Right. But
01:07what would be the case for equal waiting because you do sell winners as they get going. What would you
01:14say to that. Yeah. So if you ask the guy Mark who created the index he would say that you're
01:19feeding your fishes at each quarterly rebalance and you're taking some off the table from some of your winners. And
01:24I think there is a natural mean reversion element to an equal weighted strategy. I don't think it fits with
01:29every segment of every segment of the marketplace. But to your point in thematic products often what you see is
01:35heavy concentration. You mentioned a competitor to ours in the category which was launched much much longer before we launched
01:43Elfie. And you've got names like Nvidia in there. You've got some names in those strategies that don't have pure
01:49play exposure. And so when those companies grow disproportionately they can overwhelm some of the exposures that you're trying to
01:56accomplish.
01:57There's a five billion minimum market cap for inclusion. There's a minimum notional daily dollar volume. So there are some
02:03screens that mean you don't go too far down the cap
02:05spectrum. Gotcha. Elfie is an example of allocating towards real assets. And this is something that you've kind of built
02:12out this portfolio. You have a bunch of other funds
02:14including SDCI which covers commodities CCNR natural resource equities. And you kind of see it as a thematic fund addressing
02:23real assets in a way that people can gain exposure to all that maybe in concert maybe together maybe a
02:28combination of those. Is there any overlap between these funds. I imagine
02:31there's got to be some. Without a doubt. And Elfie is comprehensive in nature meaning it's got energy infrastructure. So
02:38pipelines moving natural gas. You can juice up your exposure there with say
02:42AMLP or NFR portfolios that are targeted in that segment of the market. Think about it as portfolio components that
02:49you're mixing and matching depending on your objectives. If it's income.
02:52If you want to enhance your nuclear exposure. There is some nuclear exposure in Elfie. But if you want to
02:57target that something like SMRF would allow you to do so. The commodities piece is really the only thing that
03:03you don't have exposure to in Elfie because it doesn't own futures contracts in SDCI or even its sister funds
03:08ESB which is focused on battery metals will give you that. So it's all about taking your portfolio and in
03:16many ways diversifying into categories that you don't have a lot of exposure to. You know tech companies hyperscalers the
03:21ones driving rising
03:22electricity demand. You already have a ton of exposure to them in the S&P 500 and VU or otherwise.
03:27Absolutely. In our thematic capture score we would look for active share. You want high active share. You want to
03:34not recognize the stocks because you already own the big ones. I agree. You've got your exposure to VU and
03:39everything else. Yeah. So I think differentiation is huge for themes. Let's talk about the dogs. That's how I know
03:46you guys. S-Dog, I-Dog, R-Dog. You have a whole suite of these dog ETFs.
03:52Dals. What's the name of it again. It's the dividend dogs ETF. Right. So these are people know that phrase
04:01but these are sector oriented. So can you go over how these are doing and what they do for investors.
04:06Yeah. So S-Dog, I-Dog, E-Dog, R-Dog. You mentioned all the dogs. It's a it's a kennel
04:11we have over at SSC Alps Advisors. But basically it takes that old dogs of the Dow approach which is
04:16one of the oldest investing mantras around.
04:18And you take the five highest yielding stocks in the Dow industrials at the beginning of the year and then
04:23you change it at a year end. And that doesn't work for a RIC compliant strategy of course.
04:27And so you expand the universe in the case of S-Dog to the S&P 500. Pick the five
04:32highest yielding stocks in each of the GIC sectors in the S&P 500 and you equally weight them.
04:38So you have balanced sector exposure. But it really is a value yield oriented way to approach value and yield
04:46investing. Do the same thing in I-Dog.
04:48And I would look at I-Dog maybe as the example recently of an allocation as we were talking about
04:54before we went on the air of people reallocating developed XUS and I-Dog has had really strong relative performance
05:01to that IFA universe.
05:03This idea of getting yield from stocks right. It is under fire because you got the jeppies of the world
05:09and you've got auto callables.
05:11I mean they are coming at you and we've seen the market share of stock dividend ETFs come down. How
05:16do you push back against all these we'll call the derivative income ETFs.
05:20So our argument is that there's a lot of these old school if you will building blocks that can be
05:26really compatible with a long term investment plan and you don't necessarily need to get that creative with all of
05:32your exposures.
05:33Of course auto callables buy rights defined outcome strategies have their time in place for certain investors. But you look
05:40at just how most investment portfolios are constructed.
05:43You've got the piece that's in fixed income and people as you know have been allocating more and more to
05:48active fixed income in the ETF wrapper perhaps more than ever before.
05:51But within the equity sleeve there's a lot of different approaches to going and achieve ambitious in some cases yield
05:58goals and dividend yielding stocks are very much a part of the framework and the pattern in which most people
06:04allocate.
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