Jim Rickards, a former insider in the financial industry, has been warning about the impact of America’s credit-based economy and the rise of the Brics Nations for years.

The violation of Gresham’s Law and Triffin’s Dilemma, the fall of the Bretton Woods Agreement, and the weaponizing of the dollar are just a few of the factors that have contributed to this potential shift.

It’s important to understand the global macroeconomics at play and be aware of the potential consequences.

Key Takeaways

• The Brics Nations announce a new currency backed by gold, which could significantly impact the global economy.
• Jim Rickards has been warning about the impact of America’s credit-based economy and the rise of the Brics Nations for years.
• Understanding the global macroeconomics at play and the potential consequences is crucial in navigating the changing landscape of the world economy.

The Rise of the Brics Nations

You may have heard of the Brics Nations, which stands for Brazil, Russia, India, China, and South Africa. These countries have been gaining force and momentum in recent years, and their rise is worth paying attention to.

One major event that highlights their growing power is their plan to announce a new currency, which is anticipated to be backed by gold. This announcement is expected to be made on August 22nd at the Brics meeting in Johannesburg.

The Brics Nations have been gaining momentum due to their production of food, gold, silver, and machinery, which the rest of the world relies on. As a result, they are no longer willing to accept the U.S. as the global bully in the playground.

The U.S. has been a credit-based economy, printing fake money and spreading it throughout the world. This has caused the rest of the world to become increasingly frustrated with the U.S. and its actions.

The Brics Nations are also gaining force due to the violation of two basic laws. The first is Gresham’s Law, which states that when bad money enters a system, good money goes into hiding. The second is Triffin’s Dilemma, which occurred in 1944 at the Bretton Woods agreement in New Hampshire. This agreement stated that the world would trade in U.S. dollars, but now it is falling apart due to Triffin’s Dilemma.

The Brics Nations are gaining momentum and force, which is something that you should be aware of. Their rise is changing the global economy, and it’s important to understand their impact.

The Impact of America’s Credit-Based Economy

You know that the US has been the big bully in the playground, but suddenly all the other kids are saying, “Well, you’re not going to be the bull anymore. We’re going to gang up on you.” That’s what the BRICS are doing. They said, “Hey, we’re going to take you down, bully.”

The announcement made by Jim Rickards a couple of weeks ago is that the BRICS nations are supposedly set to announce to the world their new currency, which he anticipates to be backed by gold. As we’ve talked about, the only other Tier One Reserve asset is gold, so this is significant. He expects them to make that announcement on August 22nd at the BRICS meeting in Johannesburg.

The US has been a credit-based economy, which means it prints fake money and spreads it throughout the world. However, the rest of the world is actually producing the food, the gold, the silver, the machinery, and all of this. Finally, the rest of the world said, “Enough’s enough.”

The reasons behind the banks running into trouble have not gone away, and at the same time, the BRICS nations are gaining force and momentum. This is all coming down fast right now, and it’s going faster and faster.

France is joining China, and they are saying, “Screw you, US. We’re going to deal with China in Chinese currency, not the US dollar.” The average American has no idea what that means.

There are two basic laws that are being violated. When Nixon in 1971 took the dollar off the gold standard, he violated Gresham’s law, which says when bad money enters a system, good money goes into hiding. The second law is Triffin’s dilemma, which happened in 1944. At the Bretton Woods agreement in New Hampshire, the world agreed that they would trade in US dollars. However, the Bretton Woods agreement is falling apart because Triffin’s dilemma meant the US had to supply dollars to every Central Bank throughout the world, so we had to print quadrillions of dollars.

The US weaponizes the dollar against Russia and tries to crush Russia’s economy. The rest of the world is saying, “Enough of you sending us your toilet paper. You take our materials, you take our production, and you send us this trash.”

Jim Rickards and His Predictions

According to Jim Rickards, the BRICS nations are planning to announce their new currency, which is expected to be backed by gold, at the BRICS meeting in Johannesburg on August 22nd. This announcement could potentially change the global economic landscape, as the United States has been seen as a bully in the play yard, printing fake money and spreading it throughout the world.

Rickards argues that the rest of the world is tired of the United States’ credit-based economy, which relies on the production of other countries for food, gold, silver, machinery, and more. The BRICS nations, including Brazil, Russia, India, China, and South Africa, are gaining force and momentum, and could potentially form a coalition with Japan and Mexico to challenge the dominance of the US dollar.

Rickards believes that the US dollar has been weaponized against other countries, such as Russia, and that the world is entering a period of currency wars. He argues that the US violated two basic laws when it took the dollar off the gold standard in 1971 and violated Gresham’s law, which states that bad money enters a system, good money goes into hiding. He also argues that Triffin’s dilemma, which occurred in 1944 at the Bretton Woods agreement, is now falling apart, as the US had to supply dollars to every central bank throughout the world, leading to the printing of quadrillions of dollars.

Rickards warns that the world is entering a period of hyperinflation, wars, and starvation, and that the average person cannot see what’s coming. He believes that people need to be cognitively aware of these changes and the potential consequences they could have on the global economy.

Understanding Global Macroeconomics

In the world of global macroeconomics, there are several key factors that are currently affecting the global economy. The United States has been the dominant player in the global economy, but other countries are now pushing back against this dominance. The BRICS nations (Brazil, Russia, India, China, and South Africa) are set to announce their new currency, which is expected to be backed by gold. This announcement is set to be made on August 22nd at the BRICS meeting in Johannesburg.

The reason behind the banks running into trouble has not gone away, and the forces outside the country are gaining momentum. The violation of Gresham’s Law and Triffin’s Dilemma are also affecting the global economy. When Nixon took the dollar off the gold standard in 1971, bad money entered the system and good money went into hiding. Triffin’s Dilemma, which happened in 1944 at the Bretton Woods agreement, meant that the US had to supply dollars to every central bank throughout the world.

The US had to print trillions and probably quadrillions of dollars, and this promised Saudi Arabia that the US would protect them. However, when Biden came into office, he weaponized the dollar against Russia, and Saudi Arabia joined Russia’s side. The dollar is now being used as a weapon against other countries, which is causing hyperinflation and war.

The weaponizing of the dollar means that it is no longer neutral like gold and is being used to fight wars. The rest of the world is tired of receiving fake money from the US and is now pushing back against this dominance. The world is about to change, and it is important to be cognitively aware of these changes. The average person may not be able to see what is coming, but it is important to understand the confluence of events that are rapidly coming to a head.

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The Troubles of Banks and the Brics’ Response

You are aware that the US has been the dominant player in the global economy, but now the other countries are ganging up against the US. The Brics Nations, comprising Brazil, Russia, India, China, and South Africa, are set to announce their new currency, which is anticipated to be backed by gold. This announcement is expected to be made on August 22nd at the Brics meeting in Johannesburg.

The US has been running a credit-based economy, printing fake money and spreading it throughout the world. However, the rest of the world is actually producing the food, gold, silver, machinery, and other resources. The Brics Nations have had enough of the US’s bullying tactics and are now standing up against it.

The troubles of banks have not gone away, and the forces outside the US are gaining momentum. France has joined China in dealing with Chinese currency instead of the US dollar, and the Brics Nations are gaining force and momentum. Nixon’s decision in 1971 to take the dollar off the gold standard violated Gresham’s law, which means when bad money enters a system, good money goes into hiding. In 1944, the Bretton Woods agreement violated Triffin’s dilemma, which meant the US had to supply dollars to every central bank throughout the world. This led to the US printing trillions of dollars and promising Saudi Arabia to protect them.

The dollar is now being weaponized against Russia, and the Brics Nations are using their currency to fight against the US. The world is changing rapidly, and it’s important to be cognitively aware of these changes. The US’s problems are not going away, and the Brics Nations are set to take over the global economy.

Violation of Gresham’s Law and Triffin’s Dilemma

As the world shifts away from the US dollar as the global reserve currency, it’s important to understand the violations of Gresham’s Law and Triffin’s Dilemma that have played a role in this shift.

Gresham’s Law states that when bad money enters a system, good money goes into hiding. In 1971, when President Nixon took the US dollar off the gold standard, people started buying more gold, causing good money to go into hiding. This violation of Gresham’s Law has had a lasting impact on the US economy and its global position.

Triffin’s Dilemma, on the other hand, refers to the US’s obligation to supply dollars to every central bank throughout the world. This obligation has led to the printing of trillions, if not quadrillions, of dollars, causing inflation and a loss of confidence in the US dollar as a stable reserve currency.

The Bretton Woods agreement in 1944 established the US dollar as the global reserve currency, but violations of Gresham’s Law and Triffin’s Dilemma have caused a shift away from the dollar as the world’s reserve currency. The emergence of the BRICS nations and their potential announcement of a new gold-backed currency further highlights this shift.

As the world continues to change, it’s important to acknowledge these violations and their impact on the global economy. The US’s position as a credit-based economy and its reliance on printing fake money has led to tensions with other nations, and the emergence of new currencies backed by more stable assets such as gold may further challenge the US’s global position.

The Fall of the Bretton Woods Agreement

You know that the Bretton Woods Agreement, which was established in 1944, made the US dollar the global reserve currency. This meant that other countries could trade with each other using the US dollar. However, this agreement began to fall apart in the 1970s due to Triffin’s Dilemma. This dilemma arose because the US had to supply dollars to every central bank throughout the world, and this required the US to print more dollars than it had in gold reserves.

In 1971, President Nixon took the US dollar off the gold standard, violating Gresham’s Law. This law states that when bad money enters a system, good money goes into hiding. As a result, people started buying more gold, and the US dollar lost its value. The US began printing more fake money, which it spread throughout the world. This led to the US becoming a credit-based economy.

The fall of the Bretton Woods Agreement has had significant consequences for the US and the world. The US has become the big bully in the playground, and other countries have started to gang up on it. The BRICS nations, which include Brazil, Russia, India, China, and South Africa, have announced their new currency, which is expected to be backed by gold. This announcement is set to be made on August 22nd, 2023, at the BRICS meeting in Johannesburg.

The US has been printing fake money and spreading it throughout the world, while the rest of the world has been producing food, gold, silver, machinery, and other goods. The BRICS nations have had enough of this and are set to take down the US. France has already joined China and is dealing with China in Chinese currency instead of the US dollar.

The fall of the Bretton Woods Agreement has led to a war using money. The US has weaponized the dollar against Russia and tried to crush Russia’s economy. The rest of the world is now using money to fight wars, as predicted by Jim Rickards in his book, Currency Wars. The fall of the Bretton Woods Agreement is a significant event that people need to be cognitively aware of, as it will change the world.

The Emergence of the Brics Coalition

You may have heard of the Brics Coalition, which refers to Brazil, Russia, India, China, and South Africa. This group of nations has been gaining momentum and force in recent years, challenging the dominance of the United States as the world’s superpower.

One of the main reasons for the emergence of the Brics Coalition is the dissatisfaction of these nations with the U.S. as the global bully. The U.S. has been printing fake money and spreading it throughout the world, while the rest of the world produces the food, gold, silver, and machinery. The Brics Coalition has had enough and is set to announce their new currency, which is expected to be backed by gold.

This announcement is anticipated to be made on August 22nd at the Brics meeting in Johannesburg. If Jim Rickards, a man who has seen it from the inside, is right, the world is about to change. The Brics Coalition’s new currency could challenge the U.S. dollar as the world’s reserve currency, which was established after World War II in the Bretton Woods agreement.

The emergence of the Brics Coalition violates two basic laws, Gresham’s Law and Triffin’s Dilemma. Gresham’s Law states that when bad money enters a system, good money goes into hiding. Triffin’s Dilemma, which occurred in 1944, meant that the U.S. had to supply dollars to every Central Bank throughout the world.

The Brics Coalition is gaining force and momentum, and more nations, such as France, are joining China in dealing with them in Chinese currency, not the U.S. dollar. The weaponizing of the dollar against Russia has led to a currency war, and the world is changing rapidly. It’s important to acknowledge these events and be cognitively aware of the potential impact they could have on the global economy.

The Civil War Inside the Country

The current state of the US economy has led to a civil war between the rich and the poor. The country’s economic policies have favored the wealthy, leading to an increasing wealth gap and rising poverty levels. The poor are struggling to make ends meet, while the rich are amassing wealth at an unprecedented rate.

This economic divide has led to a political divide, with the poor feeling increasingly disenfranchised and disconnected from the political process. The rich, on the other hand, are using their wealth and influence to shape policy in their favor, further exacerbating the divide.

The Civil War inside the country is not just an economic or political issue. It is a social issue that is tearing the fabric of society apart. The poor are angry and frustrated, while the rich are becoming increasingly isolated from the rest of society.

The current economic policies are unsustainable, and if left unchecked, they will lead to the collapse of the US economy. The government must take action to address the wealth gap and ensure that everyone has a fair chance at economic success.

In conclusion, the Civil War inside the country is a complex issue that requires a multi-faceted solution. The government must take action to address the wealth gap and ensure that everyone has a fair chance at economic success. Failure to do so will lead to the collapse of the US economy and further exacerbate the social and political divide.

Inflation and the Rise of Oil Prices

As the world continues to grapple with the effects of the COVID-19 pandemic, inflation has become a growing concern for many countries. In the United States, the Consumer Price Index (CPI) has risen sharply, with the cost of goods and services increasing at the fastest rate in over a decade. This rise in inflation has been attributed to a number of factors, including supply chain disruptions, labor shortages, and increased demand as the economy reopens.

One of the key drivers of inflation has been the rise in oil prices. The cost of crude oil has surged in recent months, with Brent crude reaching its highest level since 2018. This increase in oil prices has been driven by a number of factors, including supply disruptions, increased demand as economies reopen, and speculation in the futures markets.

The rise in oil prices has had a ripple effect across the economy, with higher fuel costs driving up the cost of transportation and goods. This has led to higher prices for consumers, as businesses pass on the increased costs to their customers.

To combat inflation, central banks have taken a number of measures, including raising interest rates and reducing the supply of money in the economy. However, these measures can have unintended consequences, such as slowing economic growth and increasing unemployment.

In the face of these challenges, it is important for businesses and individuals to be mindful of the risks posed by inflation and rising oil prices. By taking steps to manage costs and reduce their exposure to inflation, they can help to mitigate the impact of these economic challenges on their bottom line.

Weaponizing the Dollar

As the world’s reserve currency, the US dollar was supposed to be neutral and as good as gold. However, since Nixon took the dollar off the gold standard in 1971, the US has been printing fake money and spreading it throughout the world. This has led to the violation of two basic laws: Gresham’s Law and Triffin’s Dilemma.

Gresham’s Law states that when bad money enters a system, good money goes into hiding. In 1971, when Nixon took the dollar off the gold standard, people started buying more gold. Triffin’s Dilemma, on the other hand, happened in 1944 at the Bretton Woods agreement in New Hampshire. The world agreed to trade in US dollars, and everything was fine until the US had to supply dollars to every central bank throughout the world. This led to the printing of trillions and probably quadrillions of dollars.

Weaponizing the dollar means using it against other countries. The US has weaponized the dollar against Russia, trying to crush its economy. The US has also weaponized the dollar by promising Saudi Arabia that it would protect them and then weaponizing the dollar against them. This has led to the Saudis joining Russia’s side in a coalition called BRICS, which stands for Brazil, Russia, India, China, and South Africa.

The BRICS nations are set to announce to the world their new currency, which is anticipated to be backed by gold. This announcement is expected to be made on August 22nd at the BRICS meeting in Johannesburg. This could lead to the US losing its status as the world’s reserve currency and could have significant implications for the global economy.

In conclusion, the US has been the big bully in the play yard, printing fake money and spreading it throughout the world. However, the rest of the world has had enough and is ganging up on the US. The weaponization of the dollar has led to the violation of basic laws and could lead to significant changes in the global economy. It is essential to be cognitively aware of these events as they could have a significant impact on the world.

The Future: Hyperinflation, War, and Starvation

As Jim Rickards pointed out, the world is rapidly changing, and the reasons behind the banks running into trouble have not gone away. The forces outside the country, being the BRICS nations, are set to announce their new currency, which is expected to be backed by gold. This announcement is set to be made on August 22nd at the BRICS meeting in Johannesburg.

The US has been the big bully in the playground for a long time, but suddenly, all the other kids are saying, “well, you’re not going to be the bully anymore. We’re going to gang up on you.” This is what the BRICS are doing. They are saying, “We’re going to take you down, bully.”

The US has been a credit-based economy, which means that it prints fake money and spreads it throughout the world. However, the rest of the world is actually producing the food, gold, silver, machinery, and all other materials. Finally, the rest of the world said enough is enough.

There is a Confluence of events that are coming together at the same time, and it’s important to acknowledge the fact that the world is about to change. If Jim Rickards is right, America has pissed off the rest of the world, and hyperinflation, war, and starvation are on the horizon.

The weaponizing of the dollar means that the dollar is being used against other countries, like Russia. The US is dealing in fake money, which is like toilet paper, and the rest of the world is saying enough of this trash. The US takes their materials and production and sends them fake money in return.

Civilization runs on energy, and when Biden made energy so expensive and weaponized the dollar, he basically screwed the world and America on top of it. The future looks bleak, and it’s important to be cognitively aware of what’s happening because the world is changing fast, like a toilet paper roll going faster and faster.

The Role of Energy in Civilization

Energy plays a critical role in the development and progress of civilization. As you know, energy is the driving force behind almost everything we do, from powering our homes and businesses to fueling our transportation systems. Energy is essential for the production of goods and services, and it is a vital component of economic growth.

Civilization runs on energy, and without it, progress would be impossible. The availability and affordability of energy sources have a significant impact on the development of nations and their economies. As you may have heard, the world is currently undergoing a significant shift in energy production and consumption patterns.

The traditional sources of energy, such as oil, coal, and natural gas, are being replaced by renewable energy sources, such as solar, wind, and hydropower. This transition is driven by concerns over climate change and the finite nature of fossil fuels. However, the transition to renewable energy sources is not without its challenges.

One of the main challenges of renewable energy is its intermittent nature. Unlike traditional sources of energy, renewable energy sources are dependent on weather conditions and can be unpredictable. This makes it difficult to ensure a stable and reliable energy supply. Additionally, renewable energy sources require significant investment in infrastructure and technology, which can be costly.

Despite these challenges, the transition to renewable energy sources is necessary to ensure a sustainable future for civilization. The world must work together to develop and implement new technologies and infrastructure to support the transition to renewable energy sources.

In conclusion, energy is a critical component of civilization, and the transition to renewable energy sources is necessary for a sustainable future. The world must work together to overcome the challenges of renewable energy and ensure a reliable and stable energy supply for future generations.

Investing through exchange traded funds (ETFs) can provide exposure to the entire theme and access to stocks not traded in US markets. Consider funds like the Ishares Japan ETF, Ishares South Korea ETF, Vanguard Pacific Stock Index Fund, Ishares Emerging Markets Asia Fund, and Chinese stocks and ETF choices. Diversifying your portfolio with international stocks can help smooth out returns and potentially provide upside potential.

Key Takeaways

• Warren Buffett’s investment in Japanese companies may indicate a potential opportunity for investors in the Asian region.
• ETFs can provide exposure to international stocks and diversify your portfolio.
• Lower inflation rates and solid economic growth forecasts in the Asian region could produce standout returns compared to US and EU stocks.

Warren Buffett’s Investment in Japanese Companies

Warren Buffett has made a big bet on Japanese companies, investing over 17 billion in stocks of the country’s top five trading houses, namely Itochu, Marubeni, Mitsubishi, Mizuho, and Sumitomo corporations. These companies have become the Japanese equivalent of Berkshire Hathaway, holding significant investments in companies across various sectors of the economy, from logistics to real estate, aerospace, EV, and renewable energy.

Buffett’s investment in these companies is a testament to his confidence in the Japanese economy, and he has increased his stake even further, owning almost 10 percent on average of these trading houses. These trading houses have thousands of subsidiaries and companies, giving them a unique insight into the overall economy, which fits well with Berkshire’s strategy of owning investments across utilities, railroad, financial, and insurance.

Investing in Japanese companies presents an opportunity for Main Street investors to diversify their portfolios and potentially smooth out their returns from a stock crash in the US. The iShares Japan ETF (EWJ) is a great option for investors looking to gain exposure to the Japanese market. The fund holds shares of 237 large and mid-sized companies across the Japanese market and pays a 0.9% dividend yield.

The Japanese market is an industrials-heavy market, complementing US holdings that are more tech-focused. The fund offers exposure to some of the biggest companies in the world, including Toyota, Sony, and Mitsubishi, along with many stocks not otherwise available to US investors, including all five of the trading houses that Buffett is investing in.

Inflation rates across developed Asia are lower than in the US and Europe, making the region a potentially standout performer compared to US and EU stocks over the next year. Morgan Stanley estimates that disinflation in the region is well underway, and inflation is expected to be within target ranges for 80% of the region within the next three months, boosting forecasts for already solid economic growth in the area.

Asian Region Investment Prospects

If you’re looking to diversify your portfolio and potentially benefit from the growth prospects of the Asian region, there are several investment options worth considering. Warren Buffett’s recent investment in Japanese companies suggests that the region could be ready to take off.

Inflation rates across developed Asia are lower than in the US and Europe. China is already lowering its interest rates, with South Korea and Japan expected to start cutting rates soon. This is because most of the region avoided the massive pandemic stimulus that we saw in the US or Europe, leaving the countries in much better fiscal shape with lower inflation rates.

Morgan Stanley estimates that disinflation in the region is well underway, and inflation is expected to be within target ranges for 80% of the region within the next three months. This could boost forecasts for already solid economic growth in the area.

One way to invest in the Japanese market is through exchange-traded funds (ETFs) like the iShares Japan ETF (EWJ), which is up 15% this year. The fund holds shares of 237 large and mid-sized companies across the Japanese market and pays a 0.9% dividend yield. The Japanese market is more industrials-heavy, with exposure to financials and healthcare, complementing your US holdings.

Another option is the iShares South Korea ETF (EWY), which targets large and mid-sized companies holding shares of 103 stocks in the Korean market. This is a tech-heavy fund, with 37% of the portfolio in tech stocks. The stocks trade for an average of just 9.5 times on a price-to-earnings basis, less than half as expensive as US stocks.

For broader exposure to the entire Asian region, you can consider the Vanguard Pacific Stock Index Fund (VPL) or the iShares Asia 50 ETF (AIA). The Pacific fund gives you broad exposure through 2400 stocks and even some Australian exposure, while the Asia fund holds 50 stocks and has nearly 40% invested in China.

For exposure to emerging markets in the region, the iShares Emerging Markets Asia Fund (EEMA) is worth considering. The fund holds exposure to 985 stocks across the region, with a focus on tech stocks, financials, consumer, and communication services.

Finally, for exposure to Chinese stocks, you can consider the iShares MSCI China ETF (MCHI), the iShares China Large Cap ETF (FXI), or the SPDR S&P China ETF (GXC). The GXC ETF is our preferred option due to its better diversification and higher dividend yield.

Overall, investing in the Asian region could be a way to diversify your portfolio and potentially benefit from solid economic growth prospects. Consider these ETF options to gain exposure to the region.

Inflation Rates in Developed Asia

Inflation rates across developed Asia are lower than in the US and Europe. While the US inflation has come down, the FED is still raising interest rates, trying to slow the economy and prices. Europe is still battling out of control inflation and will have to continue to raise rates. In contrast, most of the Asian region avoided that kind of massive scale pandemic stimulus that we saw here in the United States or in Europe. That’s left the countries in much better shape fiscally and with much lower inflation and better able to cut rates to support growth.

China is already lowering its interest rates, with South Korea and Japan expected to start cutting rates much sooner than other developed nations. Morgan Stanley estimates disinflation in the region is well underway and expects inflation to be within target ranges for 80 percent of the region within the next three months. That could boost forecasts for already solid economic growth in the area.

Japan, in particular, has seen decades of low inflation and even deflation, and is welcoming a little higher prices, so it’s likely to stay accommodative on its monetary policy and supportive of economic growth.

Forecasted Economic Growth in Asia

Looking at the data, it appears that the Asian region could produce a standout return versus U.S and EU stocks over the next year. Inflation rates across developed Asia are lower than in the US and Europe, while China is already lowering its interest rates with South Korea and Japan expected to start cutting rates much sooner than other developed nations.

Most of the region avoided the massive scale pandemic stimulus that we saw in the United States or in Europe, leaving the countries in much better shape fiscally and with much lower inflation, making them better able to cut rates to support growth. Morgan Stanley estimates disinflation in the region is well underway and expects inflation to be within target ranges for 80 percent of the region within the next three months, which could boost forecasts for already solid economic growth in the area.

According to the data, while the U.S is expected to slide for the rest of the year, with the hope of rebounding in 2024, the Euro area is expected to crawl along at less than half a percent, while most Asian economies are expected to post one percent or higher growth. This highlights the potential for investing in Asian markets, which could provide an excellent opportunity for investors looking to diversify their portfolios.

Investing in exchange-traded funds (ETFs) that hold stocks from the region or a specific country is an easy way to gain exposure to the entire theme. The iShares Japan ETF (EWJ) and the iShares South Korea ETF (EWY) are two such funds that can provide exposure to the Japanese and Korean markets, respectively. The Vanguard Pacific Stock Index Fund (VLP) and the iShares Asia 50 ETF (AIA) are two other funds that give exposure across the entire theme.

Overall, the data suggests that investing in Asian markets could be a wise choice for investors looking to diversify their portfolios and take advantage of the potential for standout returns.

Investing in International Stocks

If you are looking to diversify your investment portfolio, international stocks could be a great option. Warren Buffett has recently made a big bet in Japanese companies, which could be a sign that the Asian region is ready to take off. In fact, there is a reason to believe that the entire Asian region could produce a standout return versus U.S and EU stocks over the next year.

One easy way to invest in international stocks is through exchange-traded funds (ETFs) that hold stocks from a specific country or region. For example, the iShares Japan ETF (EWJ) holds shares of 237 large and mid-sized companies across the Japanese market, including the top five trading houses that Berkshire Hathaway has invested in.

Another option is the iShares Asia 50 ETF (AIA), which holds 50 stocks across the entire Asian region. However, the Vanguard Pacific Stock Index Fund (VPL) could be a better choice for diversification and ex-China Asia strategy, as it holds 2400 stocks and even some Australian exposure.

It’s worth noting that foreign stocks generally trade much more cheaply than U.S stocks, with the Japanese market trading at just 14.6 times its earnings reported by the companies. Additionally, international stocks can help you smooth out your returns from a stock crash in the U.S, as having just five or ten percent of your money in international stocks can be beneficial.

While investing in international stocks can offer great potential, it’s important to do your due diligence and research before making any investment decisions. Make sure to compare the stocks in a fund with your own portfolio to avoid any overlap in a sector or a stock.

Investing Through Exchange Traded Funds

If you’re looking to invest in the Japanese market, the iShares Japan ETF (EWJ) is a great option. This ETF holds shares of 237 large and mid-sized companies across the Japanese market, including all five of the trading houses that Warren Buffett is buying. The fund pays a 0.9% dividend yield and trades for a price of just 14.6 times its earnings reported by the companies, which is a 27% discount to the price of 20 times earnings for stocks in the S&P 500.

Learn more about ETFs and their advantages here.

For exposure to the South Korean market, the iShares South Korea ETF (EWY) is a strong fund for growth investors. This ETF holds shares of 103 large and mid-sized companies across the Korean market, including familiar names like Samsung and LG. The fund trades for an average of just 9.5 times on a price-to-earnings basis, which is less than half as expensive as U.S. stocks.

If you’re looking for exposure across the entire Asian region, the Vanguard Pacific Stock Index Fund (VPL) is a great option. This ETF gives you broad exposure through 2,400 stocks and even some Australian exposure. Many of the stocks you saw in the country-specific funds like Samsung, Toyota, and Sony are also included in this fund.

For exposure to emerging markets in Asia, the iShares Emerging Markets Asia Fund (EEMA) is a good option. This ETF holds shares of 985 companies across the region, including tech stocks, financials, consumer, and communication services.

When it comes to investing in Chinese stocks, the SPDR S&P China ETF (GXC) is a great option. This ETF holds shares of 950 companies and has slightly better sector diversification than the other Chinese ETFs. It also has a higher dividend yield and a lower expense fee compared to the other options.

If you’re looking for exposure to the Japanese market, the iShares Japan ETF (ticker: EWJ) is a great option to consider. This ETF holds shares of 237 large and mid-sized companies across the Japanese market, including the top five trading houses that Warren Buffett has been investing in. With a year-to-date return of 15%, the fund also pays a 0.9% dividend yield.

One of the benefits of investing in foreign stocks is the potential for cheaper valuations, and the EWJ is no exception. The fund trades at a price-to-earnings ratio of just 14.6 times its earnings reported by the companies, which is a 27% discount to the price of 20 times earnings for stocks in the S&P 500.

The Japanese market is more heavily weighted towards industrials, financials, and healthcare, which can complement your U.S holdings. The fund also includes many stocks not otherwise available to U.S investors, including all five of the trading houses that Buffett is investing in.

To get a closer look at the stocks in the fund, you can check out the holdings in the menu. This will show you the top 10 largest positions, and you can also download a list of all the holdings to compare with your own portfolio.

Overall, the iShares Japan ETF is a solid option for investors looking to gain exposure to the Japanese market and diversify their portfolio.

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If you’re looking for an ETF that focuses on South Korea, the iShares South Korea ETF (ticker EWY) might be a good option to consider. This ETF holds shares of 103 large and mid-sized companies in the Korean market, with a focus on IT stocks. In fact, 37% of the fund is invested in tech stocks, making it a strong choice for growth investors.

One of the advantages of investing in foreign stocks is that they often trade at lower valuations than US stocks, and the EWY is no exception. The stocks in this fund trade for an average of just 9.5 times earnings, which is less than half as expensive as US stocks. Additionally, inflation in Korea is coming down fast, already at 2.7% annualized, and likely to be at the central bank’s target of 2% by the end of the year.

While Samsung dominates the Korean market and accounts for 23% of the fund’s holdings, the ETF is market-weighted, so you’ll still get exposure to a variety of other companies and sectors. And with GDP forecasts for Korea being the weakest in the region, it’s likely that stimulus will come sooner rather than later, which could mean a big upside surprise for these stocks.

Overall, the iShares South Korea ETF could be a good choice for investors looking to diversify their portfolio with exposure to the Korean market and IT sector.

Vanguard Pacific Stock Index Fund is an excellent choice for investors looking for broad exposure to the Pacific region. With a low expense ratio of just 0.08%, this fund is an affordable way to invest in over 2,400 stocks from countries like Japan, Australia, and South Korea.

One of the benefits of this fund is its ex-China strategy, which means it does not invest in Chinese stocks. This may be appealing to investors who are wary of the risks associated with investing in China, such as regulatory uncertainty and geopolitical tensions.

The fund is heavily weighted towards industrials, financials, and consumer discretionary sectors, which complement well with US holdings that are more tech-focused. Some of the top holdings in the fund include Toyota, Samsung, and BHP.

Another advantage of this fund is its strong dividend yield of 2.6%, which can provide income for investors. However, it’s important to note that the Pacific region can be volatile, and investors should be prepared for potential ups and downs in the market.

Overall, Vanguard Pacific Stock Index Fund is a solid choice for investors looking for exposure to the Pacific region. Its low expense ratio, ex-China strategy, and diversified holdings make it a great addition to any portfolio.

If you’re looking for exposure to the entire theme of emerging markets in Asia, the iShares Emerging Markets Asia Fund (EEMA) is worth considering. With 985 stocks across the region, this ETF offers a broad range of investments, including tech stocks, financials, consumer goods, and communication services.

While the fund is heavily invested in China, it also includes stocks from Thailand, Indonesia, and India. As of August 2023, the fund has a price-to-earnings ratio of 14.6, which is a 27% discount to the price of 20 times earnings for stocks in the S&P 500. This makes it an attractive option for those looking for cheaper investments.

The iShares Emerging Markets Asia Fund has a relatively low expense ratio of 0.49%, making it an affordable option for investors. The fund also pays a dividend yield of 2.3%, which is higher than the yield of the S&P 500.

Overall, the iShares Emerging Markets Asia Fund is a solid choice for investors looking for exposure to emerging markets in Asia. With a diverse range of investments and a relatively low expense ratio, this ETF offers a good balance of risk and reward.

Chinese Stocks and ETF Choices

If you are looking to invest in Chinese stocks, there are several ETF choices available to you. Warren Buffett’s recent investment in Japanese companies has caused a stir in the market, but China is also worth considering. The Chinese economy is currently out of lockdowns and is on the upswing, making it an attractive market for investors.

You can choose from three ETF options for investing in Chinese stocks: iShares MSCI China ETF (MCHI), iShares China Large-Cap ETF (FXI), and SPDR S&P China ETF (GXC). The MCHI fund is better diversified across 645 stocks and has slightly better sector diversification, though it is still heavily invested in financials. The FXI fund only holds shares of 50 companies and is much more concentrated in just three sectors, with a heavy focus on state-owned banks. The GXC fund, on the other hand, has shares of 950 companies and a sector breakdown that is very close to the MCHI fund, but with a slightly higher dividend yield.

When investing in Chinese stocks, it is important to keep in mind that the Chinese market is in a far different position than most other countries. While the economy is flatlining, it is just out of its lockdowns and on the upswing. It is crucial to do your research and choose the ETF that best fits your investment goals and risk tolerance.

Investing in Chinese stocks can be a great way to diversify your portfolio and take advantage of the growth potential in the region. With the right ETF choice, you can gain exposure to a wide range of Chinese companies, including tech, financials, and healthcare.

Opportunistic Total Returns with Active Management.

DoubleLine ETFs are designed to provide investors with opportunistic total returns by investing in a range of financial instruments, including mortgage-backed securities, commercial real estate debt, and corporate securities.

Investment Philosophy

DoubleLine was founded to offer investment services standing upon a cardinal mandate: to deliver the investor better risk-adjusted returns.

This prime mandate includes the avoidance of risk-taking which historically has led to principal losses for investors. DoubleLine stresses the importance of proper security selection, trade execution, portfolio construction, sector allocation, resourcing of the firm’s personnel and systems and ultimately the firm’s ownership structure.

Employee ownership at DoubleLine reinforces the stability of the investment teams and its accountability to customers. The process is set up so that no outside decision-makers stand between the teams and their valued clients.

The name “DoubleLine” speaks their investment philosophy: like a careful motorist on a winding mountain road, the manager must not cross the double line into the oncoming lane of risk.

The DoubleLine ETF family includes the DoubleLine Mortgage ETF (Ticker: DBMB), the DoubleLine Opportunistic Bond ETF (Ticker: DBL), and the DoubleLine Commercial Real Estate ETF (Ticker: DCRE). These active ETFs are managed by an experienced investment team led by Jeffrey Sherman, Deputy CIO of DoubleLine. The ETFs aim to provide risk-adjusted returns by investing in investment-grade and non-investment-grade instruments under normal circumstances. The property types and security selection may vary depending on the fund’s investment objectives.

DoubleLine’s investment approach is based on fundamental research and analysis, which involves granular property-level analysis and loan-level analysis. The income asset allocation committee, chaired by Jeffrey Gundlach and Morris Chen, is responsible for determining the allocation of assets across various sectors and markets. DoubleLine ETFs are subject to various risks, including interest rate risk, prepayment risks, and market risk. The ETFs may also be affected by government regulation and compliance with applicable laws in various jurisdictions.

Key Takeaways

• DoubleLine ETFs offer investors opportunistic total returns through active management of fixed-income securities.
• The ETFs invest in a range of financial instruments, including mortgage-backed securities, commercial real estate debt, and corporate securities, under normal market conditions.
• DoubleLine’s investment approach is based on fundamental research and analysis, and the ETFs are subject to various risks, including interest rate risk and market risk.

Doubleline ETFs: An Overview

Doubleline ETFs are a series of exchange-traded funds managed by Doubleline Capital LP, an employee-owned money management firm founded by Jeffrey Gundlach. The ETFs offer a wide array of investment strategies that aim to provide investors with risk-adjusted returns.

Under the guidance of its investment team, Doubleline ETFs employ active management to select securities that are expected to provide attractive relative values. The ETFs invest in a range of asset classes, including corporate securities, residential mortgage-backed securities, and commercial real estate debt, among others.

The Doubleline ETFs are designed to offer investors exposure to a variety of investment vehicles, including mutual funds, closed-end funds, and ETFs. The vehicle of a doubleline exchange-traded fund are registered with the United States Securities and Exchange Commission and comply with all applicable laws and regulations.

Doubleline ETFs are managed with a time-tested investment framework that emphasizes fundamental research and granular property-level analysis. The investment team uses a variety of tools and techniques to evaluate the economic characteristics of each security, including loan-level analysis and the Sortino ratio.

The Doubleline ETFs are available for purchase on the New York Stock Exchange (NYSE Arca). The ETFs have net assets of over $10 billion and an average expense ratio of 0.49 basis points.

Investors should carefully consider the investment objectives, risks, charges, and expenses of the Doubleline ETFs before investing. The statutory prospectus and summary prospectus contain this and other important information about the ETFs and should be read carefully before investing.

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Doubleline Capital LP is a registered trademark of Doubleline Capital LP. The Doubleline ETFs are not an offer of any particular security and are not intended to be a complete description of the terms and conditions of any security. The ETFs may not be suitable for all investors and may not be offered or sold in various jurisdictions on an unsolicited basis or in violation of local data privacy regulations.

Key Players

Jeffrey Gundlach

Jeffrey Gundlach is the CEO and Chief Investment Officer of DoubleLine Capital LP. He founded the firm in 2009 after leaving TCW Group, where he managed the Total Return Bond Fund. Mr. Gundlach is a renowned investment expert with over 35 years of experience in the fixed-income market. He is known for his contrarian views and his ability to identify market trends before they become mainstream.

Under Mr. Gundlach’s leadership, DoubleLine has become one of the fastest-growing asset managers in the United States. The firm manages over $150 billion in assets, including the DoubleLine Mortgage ETF, the DoubleLine Opportunistic Bond ETF, and the DoubleLine Commercial Real Estate ETF.

Jeffrey Sherman

Jeffrey Sherman is the Deputy Chief Investment Officer of DoubleLine. He is also the lead portfolio manager of the DoubleLine Strategic Commodity Fund and the SPDR DoubleLine Total Return Tactical ETF. Mr. Sherman has over 20 years of experience in the investment management industry. He is responsible for overseeing the firm’s investment strategies and managing its fixed-income portfolios.

Morris Chen

Morris Chen is a Portfolio Manager and Senior Vice President at DoubleLine. He is a member of the Commercial Real Estate Debt team and the Non-Agency RMBS team. Mr. Chen has over 15 years of experience in the real estate and finance industries. He is responsible for managing the firm’s commercial real estate debt investments and conducting loan-level analysis.

State Street Global Advisors

State Street Global Advisors is the investment advisor for the DoubleLine ETFs. The firm is one of the largest asset managers in the world, with over $4.5 trillion in assets under management. State Street Global Advisors is known for its expertise in the ETF space and its commitment to providing investors with innovative investment solutions.

The DoubleLine ETFs are actively managed, which means that the portfolio managers have the flexibility to adjust the fund’s holdings based on market conditions and the fund’s investment objectives. This approach allows the funds to generate risk-adjusted returns and outperform their benchmarks over the long term.

Investment Strategies

Doubleline ETFs provide investors with a wide array of investment strategies that aim to generate risk-adjusted returns. The investment team, led by Jeffrey Gundlach, employs a time-tested investment framework that focuses on active management and security selection.

Active Management

Doubleline ETFs utilize active management to identify attractive relative values within the fixed income asset class. This approach allows the portfolio managers to adjust the fund’s holdings based on market conditions and the fund’s investment objectives. Active management also helps to minimize risks, such as prepayment risks and interest rate risks, within the mortgage market.

Security Selection

Security selection is a critical component of Doubleline ETFs’ investment strategy. The portfolio managers conduct fundamental research and loan-level analysis to identify investment opportunities that meet the fund’s investment objectives. The investment team’s expertise in residential mortgage-backed securities, commercial mortgage-backed securities, and corporate securities allows them to identify undervalued securities that offer attractive risk-adjusted returns.

Time-Tested Investment Framework

Doubleline ETFs’ investment framework is time-tested and has proven successful over the past decade. The investment team’s approach is based on the economic characteristics of the underlying financial instruments and focuses on generating current income while preserving capital. The team’s investment philosophy is grounded in the belief that the best way to achieve long-term success is through a disciplined and consistent investment approach.

Overall, Doubleline ETFs offer investors a vehicle to gain exposure to a variety of fixed income asset classes through active ETFs. The investment strategies employed by the portfolio managers are designed to generate attractive risk-adjusted returns under normal market conditions. It is important to note that investing in any particular security carries risks, and investors should carefully consider the fund’s investment objectives, risks, and charges and expenses before investing.

Doubleline ETF Types

Doubleline Capital offers a range of exchange-traded funds (ETFs) that aim to provide investors with attractive risk-adjusted returns. The firm’s active management approach and expertise in fixed income and real estate markets are reflected in its ETF offerings.

Doubleline Mortgage ETF

The Doubleline Mortgage ETF seeks to provide current income and capital appreciation by investing primarily in mortgage-backed securities (MBS). The fund’s investment team, led by Jeffrey Gundlach, has years of experience in the mortgage market and employs a time-tested investment framework to identify attractive relative values in the MBS market. The fund may also invest in other types of mortgage-related securities, such as collateralized mortgage obligations (CMOs) and commercial mortgage-backed securities (CMBS).

Doubleline Opportunistic Bond ETF

The Doubleline Opportunistic Bond ETF aims to provide total returns by investing in a wide array of fixed income securities, including investment grade and high yield corporate securities, government bonds, and mortgage-related securities. The fund’s portfolio managers, led by Jeffrey Sherman, seek to generate alpha by identifying opportunities in the global fixed income markets and employing an active management approach. The fund may also use derivatives to enhance returns and manage risk.

Doubleline Commercial Real Estate ETF

The Doubleline Commercial Real Estate ETF seeks to provide total returns by investing in senior commercial real estate debt. The fund’s investment team, led by Morris Chen, conducts granular property-level analysis to identify attractive investment opportunities in the commercial real estate market. The fund may invest in various property types, including office, retail, industrial, and multifamily properties.

Spdr Doubleline Total Return Tactical ETF

The Spdr Doubleline Total Return Tactical ETF aims to provide total returns by investing in a diversified portfolio of fixed income securities. The fund’s investment strategy is based on the investment insights of Jeffrey Gundlach and his team, and seeks to generate alpha by actively managing the fund’s exposure to various fixed income sectors and market segments. The fund may also use derivatives to enhance returns and manage risk.

Overall, Doubleline Capital’s ETF offerings provide investors with access to the firm’s expertise in fixed income and real estate markets, and aim to deliver attractive risk-adjusted returns in normal market conditions. However, investors should carefully consider the fund’s investment objectives, risks, and fees before making any investment decisions.

Investment Objectives

DoubleLine ETFs aim to provide investors with opportunistic total returns by investing in various fixed income securities. The investment objectives of DoubleLine ETFs are as follows:

DoubleLine Mortgage ETF

The DoubleLine Mortgage ETF seeks to provide current income and total return by investing in mortgage-backed securities (MBS). The fund’s investment team employs an active management strategy to select MBS that offer attractive risk-adjusted returns. The fund primarily invests in investment-grade MBS, but may also invest in non-investment grade MBS under certain circumstances.

DoubleLine Opportunistic Bond ETF

The DoubleLine Opportunistic Bond ETF aims to provide total return by investing in various fixed income securities, including corporate securities, government securities, and MBS. The investment team uses a fundamental research approach to select securities that offer attractive relative values. The fund may also invest in securities that are not included in the benchmark index, the Bloomberg U.S. Aggregate Bond Index.

DoubleLine Commercial Real Estate ETF

The DoubleLine Commercial Real Estate ETF seeks to provide total return by investing in senior commercial real estate debt. The fund’s investment team uses a time-tested investment framework to analyze the economic characteristics of various property types and select securities that offer attractive risk-adjusted returns. The fund may also invest in non-agency CMBS under certain circumstances.

SPDR DoubleLine Total Return Tactical ETF

The SPDR DoubleLine Total Return Tactical ETF aims to provide total return by investing in various fixed income securities, including government securities, corporate securities, and MBS. The investment team employs an active management strategy to select securities that offer attractive risk-adjusted returns. The fund may also use derivatives to manage risk and enhance returns.

Overall, DoubleLine ETFs offer a wide array of investment strategies that aim to provide investors with opportunistic total returns. The investment team’s years of industry experience and expertise in fixed income securities make DoubleLine ETFs a trusted vehicle for investors seeking exposure to this asset class.

Risk-Adjusted Returns

DoubleLine ETFs offer investors the potential for attractive risk-adjusted returns. The funds are actively managed by experienced portfolio managers who seek to identify opportunities and manage risks in a variety of asset classes.

Under normal circumstances, the funds invest in a wide array of investment strategies, including corporate securities, mortgage-backed securities, and commercial real estate debt. The funds’ investment objectives are to provide current income and total returns.

The funds’ investment team uses a time-tested investment framework that incorporates fundamental research and granular property-level analysis to identify attractive relative values. The team seeks to manage risk by diversifying across various property types and security selection.

Investors should be aware that, like all investment vehicles, DoubleLine ETFs carry risks. The funds may be subject to prepayment risks, interest rate risks, and other risks associated with fixed income investments. Additionally, the funds may invest in non-investment grade securities, which carry a higher degree of risk than investment grade securities.

Investors should carefully consider the fund’s investment objectives, risks, charges, and expenses before investing. The funds’ prospectuses and summary prospectuses contain this and other important information about the investment services and should be read carefully before investing.

In summary, DoubleLine ETFs offer investors the potential for attractive risk-adjusted returns through active management of a diversified portfolio of income securities. The funds’ investment team has years of industry experience and uses a time-tested investment framework to identify opportunities and manage risks. However, investors should be aware that all investment vehicles carry risks and should carefully consider the fund’s investment objectives and risks before investing.

Fundamental Research

DoubleLine Capital’s investment team employs a time-tested investment framework to identify attractive relative values across a wide array of investment strategies. The team’s approach is grounded in fundamental research, which involves analyzing the economic characteristics of financial instruments and their underlying assets.

In the ETF space, DoubleLine’s active management approach is exemplified by its suite of exchange-traded funds, including the DoubleLine Mortgage ETF, DoubleLine Opportunistic Bond ETF, and DoubleLine Commercial Real Estate ETF. These funds seek to provide risk-adjusted returns by investing in a range of fixed income securities, including residential mortgage-backed securities, corporate securities, and senior commercial real estate debt.

The investment team’s approach to security selection is based on a granular property-level analysis of various property types, as well as a thorough assessment of prepayment risks and interest rate sensitivity. In addition, the team’s extensive experience in the mortgage market enables it to identify attractive opportunities in both agency and non-agency RMBS and CMBS.

Under the leadership of Jeffrey Gundlach, DoubleLine has become one of the major players in the ETF market, with net assets of over $10 billion across its suite of funds. The SPDR DoubleLine Total Return Tactical ETF, managed by Jeffrey Sherman, is one of the firm’s flagship products, offering exposure to a diversified portfolio of fixed income securities.

Investors should carefully consider the investment objectives, risks, charges, and expenses of any DoubleLine ETF before investing. The statutory and summary prospectuses contain this and other important information about the investment company and should be read carefully before investing. DoubleLine is an employee-owned money management firm that is registered with the Securities and Exchange Commission. The firm is committed to complying with all applicable laws and regulations regarding the protection of personal information in various jurisdictions, and does not offer any particular security on an unsolicited basis in violation of local data privacy regulations.

Investment Grade and Non-Investment Grade Instruments

Doubleline ETFs offer a wide range of investment options, including both investment grade and non-investment grade instruments. These instruments differ in credit quality and risk, and investors should carefully consider their investment objectives and risk tolerance before investing in either category.

Investment grade instruments are those that are considered to have a low risk of default. These instruments are typically issued by companies or governments with strong credit ratings. Doubleline offers several ETFs that focus on investment grade instruments, such as the Doubleline Opportunistic Bond ETF.

On the other hand, non-investment grade instruments, also known as high-yield or junk bonds, are issued by companies or governments with lower credit ratings. These instruments carry a higher risk of default, but also offer the potential for higher returns. Doubleline offers ETFs that focus on non-investment grade instruments, such as the Doubleline Mortgage ETF.

Investors should be aware that non-investment grade instruments are generally more volatile than investment grade instruments, and may be subject to greater price fluctuations. However, under the right circumstances, non-investment grade instruments can provide attractive risk-adjusted returns.

Doubleline’s investment team has years of industry experience in security selection and active management, and uses a time-tested investment framework to select securities for its ETFs. This approach allows the team to identify attractive relative values across a wide array of investment strategies, including both investment grade and non-investment grade instruments.

Investors should carefully review the prospectus and other important information before investing in any Doubleline ETF. It is also important to consider the fund’s investment objectives, net assets, and average expense ratio, among other factors.

Regulation and Compliance

Applicable Laws

DoubleLine ETFs are subject to various laws and regulations in the United States. The funds are registered with the Securities and Exchange Commission (SEC) and operate in compliance with the Investment Company Act of 1940. Additionally, the funds comply with applicable state and federal securities laws.

Privacy Policy

DoubleLine Capital LP, the parent company of DoubleLine ETFs, is committed to maintaining the privacy of personal information collected from investors. The company’s privacy policy outlines how personal information is collected, used, and protected. DoubleLine Capital LP maintains physical, electronic, and procedural safeguards to protect personal information.

Local Data Privacy Regulations

DoubleLine ETFs operate in various jurisdictions and are subject to local data privacy regulations. The funds comply with applicable data privacy laws, including the EU General Data Protection Regulation (GDPR). DoubleLine ETFs do not share personal information with third parties on an unsolicited basis, unless required by law.

DoubleLine Capital LP and its affiliates may use personal information to offer investment services and products to investors. The company may also use personal information for marketing purposes, subject to applicable laws and regulations.

DoubleLine ETFs do not offer any particular security and are not guaranteed to provide risk-adjusted returns. The funds invest in a wide array of investment strategies, including corporate securities, residential mortgage-backed securities, and commercial real estate debt. Under normal circumstances, the funds invest at least 80% of their net assets in income instruments of any credit quality.

DoubleLine ETFs are managed by an experienced investment team, including Jeffrey Gundlach, Morris Chen, and Robert Shiller. The team employs a time-tested investment framework to identify attractive relative values in the asset class.

In recent years, DoubleLine ETFs have introduced new products, including the DoubleLine Opportunistic Credit Fund and the DoubleLine Yield Opportunities Fund. The funds offer exposure to different areas of the fixed income market, including non-agency RMBS, non-agency CMBS, and senior commercial real estate debt.

DoubleLine Capital LP is an employee-owned money management firm founded in 2009 by Jeffrey Gundlach. The company manages over $150 billion in assets and is a registered trademark of DoubleLine Capital LP.

Market Overview

ETF Market

DoubleLine Capital LP is a well-known player in the ETF space, offering a wide array of investment strategies through its active ETFs. The DoubleLine ETFs are managed by a team of experienced professionals, led by the firm’s founder, Jeffrey Gundlach.

According to State Street Global Advisors, as of June 30, 2023, DoubleLine Capital LP had a total of 5 ETFs with net assets of $4.3 billion. The SPDR DoubleLine Total Return Tactical ETF (TOTL) is the largest of the DoubleLine ETFs, with net assets of $3.3 billion.

Mortgage Market

DoubleLine’s mortgage ETF, the DoubleLine Mortgage ETF (DBLE), seeks to provide current income by investing in residential mortgage-backed securities (RMBS) and other mortgage-related assets. The fund’s investment team, led by Morris Chen, has years of experience in the mortgage market and utilizes a time-tested investment framework to identify attractive relative values in the market.

The mortgage market is subject to prepayment risks and interest rate risk, which can affect the performance of the fund. However, the fund’s active management approach and focus on security selection can help mitigate these risks.

Commercial Mortgage-Backed Securities Market

The DoubleLine Commercial Real Estate ETF (CRE) invests in a variety of property types, including senior commercial real estate debt and non-agency commercial mortgage-backed securities (CMBS). The fund’s portfolio managers, led by Jeffrey Sherman, conduct granular property-level analysis to identify attractive investment opportunities in the market.

The commercial mortgage-backed securities market is subject to government regulation and economic conditions, which can affect the performance of the fund. However, the fund’s investment in a diversified portfolio of income securities of any credit quality and its focus on risk-adjusted returns can help mitigate these risks.

Overall, the DoubleLine ETFs offer investors a vehicle to gain exposure to various segments of the fixed income market through active management and a focus on risk-adjusted returns. Investors should carefully consider the fund’s investment objectives, risks, and expenses before investing.

Investment Risks

Interest Rate

Investing in Doubleline ETFs involves certain risks, including interest rate risk. This is the risk that changes in interest rates will negatively impact the value of the ETF’s investments. The value of fixed-income securities, such as those held by Doubleline ETFs, typically decreases when interest rates rise and increases when interest rates fall. This means that if interest rates rise, the value of the ETF’s investments may decline, which could negatively impact the ETF’s net asset value (NAV).

Prepayment Risks

Another risk associated with investing in Doubleline ETFs is prepayment risk. This is the risk that borrowers will pay back their loans earlier than expected, which can negatively impact the ETF’s performance. In the case of mortgage-backed securities, prepayments can occur when homeowners refinance their mortgages or sell their homes. This can result in the early repayment of the underlying loans, which can reduce the amount of interest income that the ETF receives.

To mitigate these risks, Doubleline ETFs employ active management strategies, which allow the ETF’s portfolio managers to adjust the ETF’s holdings in response to changing market conditions. Additionally, the ETFs invest in a wide array of investment strategies, which helps to diversify the ETF’s portfolio and reduce the impact of any single investment on the ETF’s performance.

Investors should carefully consider the risks associated with investing in Doubleline ETFs before making any investment decisions. They should also review the ETF’s prospectus and consult with their financial advisor to determine whether investing in Doubleline ETFs is appropriate for their investment objectives and risk tolerance.

Income Asset Allocation Committee

The Income Asset Allocation Committee is a team of experienced investment professionals at DoubleLine Capital LP, led by Jeffrey Gundlach, who oversee the firm’s income-oriented investment strategies. The committee’s primary objective is to identify attractive investment opportunities across a wide range of income-producing asset classes, including mortgage-backed securities, corporate bonds, and commercial real estate debt.

Under the guidance of Mr. Gundlach, the committee employs a time-tested investment framework that emphasizes risk management and capital preservation while seeking to achieve attractive risk-adjusted returns. The committee’s investment decisions are based on a deep understanding of the economic and market conditions that impact the performance of income-producing assets.

The committee’s investment process involves a rigorous fundamental research approach that includes granular property-level analysis for commercial real estate debt investments and loan-level analysis for mortgage-backed securities. The team also conducts extensive analysis of economic and market data to identify attractive relative values across different asset classes.

The Income Asset Allocation Committee is responsible for managing several DoubleLine exchange-traded funds, including the DoubleLine Mortgage ETF, the DoubleLine Opportunistic Bond ETF, and the DoubleLine Commercial Real Estate ETF. These funds provide investors with exposure to a diverse range of income-producing assets and are managed using an active management approach designed to take advantage of market inefficiencies and generate attractive returns.

Overall, the Income Asset Allocation Committee is a key component of DoubleLine’s investment services and is dedicated to providing investors with access to a wide array of investment strategies that seek to generate consistent income and attractive risk-adjusted returns.

Conclusion

DoubleLine ETFs offer investors a unique opportunity to gain exposure to various asset classes and investment strategies that have the potential to generate attractive risk-adjusted returns. The firm’s experienced investment team, led by Jeffrey Gundlach, has a time-tested investment framework that focuses on fundamental research and security selection.

Investors can choose from a wide array of investment strategies, including mortgage-backed securities, commercial real estate debt, and corporate securities. The DoubleLine Opportunistic Bond ETF (DBL) and the SPDR DoubleLine Total Return Tactical ETF (TOTL) have both performed well over the past decade, providing investors with solid returns and low expense ratios.

The DoubleLine Mortgage ETF (DMB) provides exposure to the residential mortgage-backed securities market, while the DoubleLine Commercial Real Estate ETF (CRE) offers exposure to the commercial mortgage-backed securities market. Both funds utilize a granular property-level analysis to identify attractive relative values and manage prepayment risks.

Investors should be aware of the risks associated with investing in ETFs, including interest rate risk, credit risk, and market risk. However, DoubleLine’s active management approach and focus on risk management can help mitigate these risks and provide investors with a potentially attractive source of current income.

Overall, DoubleLine ETFs are a compelling investment option for investors looking to diversify their portfolios and gain exposure to a range of income-generating asset classes. With its experienced investment team, time-tested investment framework, and focus on risk management, DoubleLine is one of the major players in the ETF space and is well-positioned to continue offering innovative investment vehicles that meet the needs of investors in various jurisdictions.

Frequently Asked Questions

What are DoubleLine ETFs?

DoubleLine ETFs are exchange-traded funds managed by DoubleLine Capital LP, an employee-owned money management firm founded by Jeffrey Gundlach. These ETFs offer investors access to a wide array of investment strategies, including corporate securities, residential mortgage-backed securities, and senior commercial real estate debt.

What is the investment objective of DoubleLine ETFs?

The investment objective of DoubleLine ETFs is to provide investors with risk-adjusted returns through active management of a diversified portfolio of income securities. The funds seek to generate current income while also providing the potential for capital appreciation.

How do DoubleLine ETFs generate total returns?

DoubleLine ETFs generate total returns through a combination of income and capital appreciation. The funds invest in a variety of asset classes, including mortgage-backed securities, commercial real estate debt, and government bonds. The investment team uses a time-tested investment framework to identify attractive relative values and security selection.

What is the expense ratio for DoubleLine ETFs?

The average expense ratio for DoubleLine ETFs is 0.48%, which is lower than the average expense ratio for ETFs in the market.

What is the historical performance of DoubleLine ETFs?

DoubleLine ETFs have a strong track record of performance over the past decade. The funds have consistently outperformed their benchmark indexes and have delivered attractive risk-adjusted returns.

Who are the portfolio managers for DoubleLine ETFs?

The portfolio managers for DoubleLine ETFs include Jeffrey Gundlach, Robert Shiller, Morris Chen, and Jeffrey Sherman. They have years of industry experience and are responsible for managing the funds’ investment strategies and overseeing the investment services provided to investors.

But what should we do in times like these where every metric under the sun is showing us that the market is dangerously overvalued? Luckily, the grandfather of passive investing, Jack Bogle, has some timeless advice for us. In a 1997 speech, Bogle discusses how passive investors should navigate through even the most expensive market situations.

Key Takeaways

• Keep investing no matter what the market is doing.
• Give yourself time to invest in stocks and bonds.
• Have rational expectations about future returns and be mentally prepared for market declines.

Current Market Analysis

Schiller PE and Wilshire GDP

As of today, the Schiller PE ratio is around 35, which means investors are willing to pay double the price for the S&P 500 as compared to what they would normally pay historically. Additionally, the Wilshire GDP/Buffett Indicator is now at 200, which is significantly higher than a fully priced stock market at around 100 and a cheap stock market at 50-60.

Passive Investing

Passive investing has become the most common investing strategy worldwide. It involves buying the entire market and periodically contributing to a broadly diversified portfolio. This method of investing has made a lot of investors a lot of money over a long period of time. However, it can be challenging for passive investors to continue investing during times when the market is dangerously overvalued.

Market Overvaluation

The stock market is currently smashing through all-time highs, and the market is expensive. Investors are speculating on higher and higher valuations, which is driving the market returns in the short run. However, the crystal clear lesson of history is that in the long run, fundamentals drive returns.

Potential Market Correction

In times when the market is overvalued, there are two possible future scenarios. The first scenario is a market drop of 35%, which would lower the price-earnings ratio to a more normal level of about 13 times. The second scenario is a new economic boom time, where businesses can grow very quickly, lifting the intrinsic value of the businesses and thus the market.

As a passive investor, it’s essential to keep investing, as the biggest risk is not investing at all. Additionally, it’s crucial to have rational expectations about future returns and be mentally prepared for market declines. It’s also important to remember that this too shall pass away, and your emotions can kill your investment program. Impulse is your foe, so keeping your emotions out of your investment program is key.

In conclusion, it’s challenging to predict the future of the stock market. However, as a passive investor, it’s essential to continue investing, have rational expectations, and be mentally prepared for market declines. Remember, time is your friend, and compound interest is a miracle.

Role of Passive Investors

As a passive investor, my investment strategy is to buy the whole market and hold onto it for the long term. This strategy has made a lot of investors a lot of money consistently over a long period of time. However, the current market conditions are making it difficult for me and many other passive investors to continue investing in the market.

Passive Investing Strategy

Passive investing is now by far the most common investing strategy in the whole world. The idea here is that we consistently invest throughout our whole life and we simply get the average market return by doing that. There’s no brain power involved, we’re not trying to pick individual stocks, we’re not staying up all night doing research on individual businesses, we’re simply buying the market and going along for the ride.

The ability of this strategy to work across decades and decades, regardless of what market conditions we see, makes this strategy just so powerful. So, as a passive investor, I will continue to show up and invest no matter what the market is doing.

Investing in Overvalued Market

However, the current market conditions are making it difficult for me and many other passive investors to continue investing in the market. The stock market is currently smashing through all-time highs, and the market is expensive. We’re currently looking at a Shiller PE of around 35. What that means is essentially investors are willing to pay realistically double for the S&P 500 as to what they would normally pay for it historically.

We’re also seeing a Wilshire GDP, a Buffett indicator of now 200, which is just insane considering like a fully priced stock market is at about 100 and a cheap stock market is like 50-60. Most of us investors out there are passive investors, and it’s been quite painful showing up and continually sinking more and more money into the market at these levels.

However, as a passive investor, I should remember that the biggest risk I can take right now is not investing at all. It’s essential to keep investing no matter what the market’s doing. I should also have rational expectations about future returns and be mentally prepared for market declines. Impulse is my foe, and my emotions can kill me. I should keep them out of my investment program because impulse is my foe.

Insights from Jack Bogle

Market Conditions in 1997

As a passive investor, it can be challenging to invest during times when the market is overvalued. In 1997, Jack Bogle, the founder of the Vanguard Group, discussed similar market conditions that we are currently experiencing. He observed that speculation was driving stock returns in the short run, while fundamentals of dividend yields and earnings growth were taking a back seat.

Bogle’s observations align with the current market conditions, where investors are willing to pay double for the S&P 500 compared to historical prices. The market is currently expensive, with a Schiller PE of around 35 and a Wilshire GDP/Buffett Indicator of 200, indicating that the market is dangerously overvalued.

Two Possible Future Scenarios

Bogle highlighted two possible future scenarios when the market is overvalued. The first scenario is a market drop of 35 percent, which would lower the price-to-earnings ratio to a more normal level of about 13 times. The second scenario is a new era of boom times and high valuations, where businesses grow very quickly, lifting the intrinsic value of the businesses and the market.

Bogle emphasized that, in the long run, fundamentals drive returns, and price will eventually align with intrinsic value. As passive investors, we should invest in the long-term trends of the stock market, regardless of short-term market conditions.

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Five Timeless Tips

Bogle provided five timeless tips for passive investors to navigate even the most expensive market situations:

1. Keep investing: The biggest risk is the long-term risk of not putting your money to work at a generous return, not the short-term risk of price volatility. No matter what the market is doing, there is a far bigger risk in not investing than continuing to invest.
2. Give yourself time: If you’re in your 20s, begin to invest in stocks, and if you’re in your 60s, invest more in bonds and lessen stocks. Remember that compound interest is a miracle, and time is your friend.
3. Have rational expectations: Be mentally prepared for market declines and have rational expectations about future returns. In good times and bad times alike, “this too shall pass away.”
4. Stay the course: Stick to your investment plan and avoid making impulsive decisions based on emotions. Your emotions can kill your investment program, so keep them out of it.
5. Keep costs low: As passive investors, we should aim for low-cost investing. Keep the fees and expenses of your investment portfolio as low as possible.

In conclusion, as passive investors, we should continue to invest regardless of market conditions. We should focus on the long-term trends of the stock market, have rational expectations about future returns, and avoid making impulsive decisions based on emotions. By following these timeless tips from Jack Bogle, we can navigate even the most expensive market situations with confidence and knowledge.

Conclusion

After analyzing the current state of the market and listening to the advice of Jack Bogle, the founder of Vanguard and the grandfather of passive investing, it is clear that passive investors should continue to invest even in times of market volatility and overvaluation. The biggest risk for passive investors is not investing at all, and the power of compound interest over the long term makes this strategy incredibly effective.

It is important to remember that time is your friend, and rational expectations about future returns should be taken into account. Market declines are inevitable, but they too shall pass away. Emotions can be detrimental to your investment program, so it is best to keep them out of the equation and stick to a long-term plan.

While the market may seem dangerously overvalued at the moment, there are still opportunities for passive investors to invest in the long-term trends of the stock market. By following the principles of investing outlined by Jack Bogle, passive investors can navigate even the most expensive market situations with confidence and knowledge.