Gain +1,000% with Becky ETF?

"Becky ETF" has become the talk of the town on Reddit, Twitter and every other meme stock trader virtual space. Is it just another hyped meme or a legit exchange traded fund?

Introducing the Becky ETF

Becky is an unlisted ETF simulation that tracks a fictional index called the S&P Becky 10 index. This index is made of 10 companies that represent the core American female lifestyle, selling premium goods and services mostly but not exclusively to rich and upper-middle-class women including:

• Adobe Inc: American software company that engages in the provision of digital marketing and media solutions.
• Apple Inc: American multinational technology company that specializes in consumer electronics, computer software, and online services.
• Chipotle Mexican Grill: American chain of fast casual Mexican restaurants in the United States, United Kingdom, Canada, Germany, and France.
• Etsy: American e-commerce company focused on handmade or vintage items and craft supplies.
• Facebook Inc: American multinational technology company providing popular social media and communication platform (Facebook, WhatsApp, Instagram and Messenger).
• Lululemon Athletica Inc: Canadian multinational athletic apparel retailer.
• Netflix: American pay television over-the-top media service and original programming production company.
• Pinterest: American image sharing and social media service designed to enable saving and discovery of information on the internet using images, videos and GIFs.
• Peloton: American exercise equipment and media company.
• Shopify: a Canadian e-commerce platform for online stores and retail point-of-sale systems.

What’s Becky ETFs' strategy?

The strategy stems from an article called "Female Economy" published on the Harvard Business Review, that shows women make the purchasing decision in the case of 94% of home furnishings, 92% of vacations, 60% of automobiles, and 51% of consumer electronics. This study also suggests that there are 6 types of female consumers. 

1. The Fast Tracker: she is part of the educated economic, elite seeking adventure and learning. They represent 24% of the population and 34% of earned revenue.
2. The Pressure Cooker: this segment represents married women with kids, who feel ignored and stereotyped. They represent 22% of the population and 23% of earned income.
3. The Relationship-focused: women in this segment are content and optimistic, aren't pressed with time and have ample discretionary income. They are also focused on experiences not product. This segment represents 16% of the population and 13% of earned income.
4. Managing on her own: women who are single again, divorced or widowed and looking to form connections. They represent 10% of the population and hold 9% of the buying power.
5. Fulfilled Empty Nester: the segment of women that is largely neglected by marketers. They tend to care more about age, health, travelling, exercise and leisure. They represent 15% of the population and 16% of the buying power.
6. Making Ends Meet: relatively poor women who mostly lack college education. They have less money to spend on beauty or exercise and usually seek credit, value and small luxuries.

In Becky's case, the ETF is constructed around companies that cater to the fast trackers, women who have solid financials and independent personalities that enable them to spend a large of portion of their money for premium services and goods. At first glance, the strategy makes sense considering that some of these companies have some the of best brand recognitions and cult-like followings, but does it work?

Becky ETF performance

Becky's performance has been tracked between January 2015 and December 2020.

During that period, Becky gained +1079% compared to the S&P 500's +84%. That is some jaw-dropping returns that few fund managers can brag about. Unfortunately, there's no tracking post-2020, but one must assume that the four-digit returns are still holding strong, especially with the overall market recovery amid economic reboots and revival of the retail industries.

Other Becky ETF mixes

There's another version of Becky called the Becky Small Cap. It holds smaller companies in terms of market cap like Bumble, Starbucks, Spotify and Ulta Beauty among others. Reddit users have also started creating their own Beckys, adding similar companies to the mix and evaluating their performances. They even started a CHAD Index, a male version of Becky. Unsurprisingly, it holds companies that mostly cater men like Nike, Ralph Lauren, Under Armour and AB InBev.

So, we all agree that Reddit and Twitter users are becoming more creative and more influential, capable of getting their ideas out to thousands of other users. The question is: With Wall Street historical tendency to follow the money, would they finally cater the audience and officially launch a Becky ETF? ($Becky)

Well… RoundHill Investments filed for a Meme ETF, so everything is possible!

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