ETFs that track the stock transactions of members of the US Congress are planned


(Bloomberg) — A pair of exchange-traded funds that mirror the personal portfolios of members of Congress may be coming soon.

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The Unusual Whales Subversive Democratic Trading ETF (ticker NANC) and the Unusual Whales Subversive Republican Trading ETF (KRUZ) would analyze the financial disclosure of legislators from both parties and their spouses and dependent children to build a portfolio of 500-600 holdings , according to a regulatory filing Thursday. When a position is marked as sold, ETFs also unload the security.

The proposed funds would take advantage of a controversy over stock trading by lawmakers that sparked a flurry of bills to revise or update a 2012 law that governs disclosure, which have largely stalled despite bipartisan support. Currently, members of Congress are required to disclose any securities transaction worth more than $1,000 within 45 days.

While it’s unclear whether bundling lawmakers’ portfolios into an ETF will generate returns, it will almost certainly generate buzz, said Bloomberg Intelligence ETF analyst James Seyffart.

“It’s a fixation of the online business community and financial Twitter to follow what politicians are doing,” Seyffart said. “I don’t know what kind of longevity this strategy will have, but I think they’ll get a lot of interest and if these things start to beat the market, I think they could garner more than enough assets to be profitable.”

The funds will focus solely on equity stakes, the filing says. Both ETFs would charge an expense ratio of 1%.

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