Wall Street is dying...
Big brokers like Morgan Stanley are being replaced by more efficient alternatives, and traditional investments like stocks and bonds are falling by the wayside.
It began with companies like E-Trade introducing online trading...
And you can see it today as Peer-to-Peer Lending and Equity Crowdfunding find their place in the mainstream.
Matt and I saw more evidence of this trend last week, while speaking at a private investing conference in Coronado Island, California.
In particular, we were introduced to someone who’s disrupting the $32 trillion mutual fund and ETF industries...
And while he’s at it, he’s giving investors like you a way to profit from the most important trends on the planet.
Investing in Ideas
A few years ago, a senior Microsoft executive named Hardeep Walia took a sabbatical.
During his time off, Hardeep became convinced that “smart phones” – phones like the iPhone – were the future of computing. He wanted to bet big on the sector.
So he asked a bunch of his friends from the investment world for the best way to play the entire smart phone market.
Their answer?
“Buy Apple.”
He wasn’t convinced:
Sure, the iPhone is a big deal, but what about all the related opportunities?
What about investing in the manufacturers of the smart phone chips?
Or in the companies that build the phone’s touch screens?
Or in the companies that provide high-speed telecom services?
To play an entire sector, you’d want to buy all of those companies, too.
But as Hardeep came to learn, there wasn’t a simple way to do it.
Ideally, there should be a mutual fund or ETF that focused just on the smart phone market. But as he came to learn, there wasn’t one.
So he got the idea to create one himself...
And then he took it a step further:
He started a company where anyone – people like you and me – could create their very own ETF, and then let others invest in it.
He called his company Motif Investing.
“Motifs”
Simply put, a “Motif” is a basket of stocks centered around a single idea or theme.
In Hardeep’s case, he wanted to build a Motif around the smart phone market.
So he’d add 20 to 30 stocks to his Motif — including device makers like Apple, chip makers like Intel, and telecom providers like Verizon.
And then others who are interested can invest alongside him.
It’s quick and easy — and you don’t pay commissions on dozens of individual stocks.
And there are plenty of options to choose from.
Today, there are already more than 11,000 Motifs...
That’s an impressive number – especially if you consider that, currently, only 1,375 ETFs are available in the US.
Investing in Motifs
Motifs are a simple, convenient way to discover and benefit from emerging trends.
For example, we recently wrote about the Cyber Security megatrend.
If you’d been intrigued with the sector after reading our article, you could have bought some stock in Symantec – but then you’d be exposed to the risk of an individual company.
Ideally, you would have invested in a fund that focused on this trend...
But unfortunately, there aren’t any Cyber Security-specific ETFs out there. The sector is still young, and it takes time for new mutual funds or ETFs to get started.
If you were looking to build a diversified portfolio, your only alternative was to find, research and buy 20 to 30 individual stocks.
But now, with Motif, you could simply purchase one of their Cyber Security Motifs.
Explore...
It’s not difficult to see how Motifs could one day replace traditional mutual funds and ETFs. They’re easier to setup, they're more focused and they're better at capturing the upside potential of emerging trends and themes.
So go ahead and explore Motif – build one of your own Motifs, or browse through the existing ones to play a trend you believe in.
One final note: Crowdability has no financial relationship with Motif Investing, or with any of the Motifs listed on their website. We just think it’s a smart concept, and worthwhile to explore.
Happy Investing!
Best Regards,
Founder
Crowdability.com
