Day-trading Redditors nearly crashed the stock market. Now they’ve been packaged into a new ETF.

If you sat out the GameStop soap opera, never fear — you can get the same strategy, with a little more diversification in this new fund

By Andrea Riquier on March 3, 2021

If you thought an ETF made up of the buzziest stocks, as determined by social-media chatter, seemed like the natural conclusion to late January’s Reddit-fueled roller-coaster ride through the stock market, you were right.

On Thursday, asset manager VanEck will launch the VanEck Vectors Social Sentiment ETF, which offers exposure to stocks with “the most bullish investor sentiment and perception.” On Tuesday, however, VanEck’s plans to roll out the fund in the standard orderly fashion fell victim to the curse of 2021.

Dave Portnoy, founder of Barstool Sports and the self-proclaimed king of the retail trading boom, tweeted an elaborately produced “emergency press conference” video to debut the ETF.

Emergency Press Conference – Introducing $BUZZ ETF pic.twitter.com/sgTc4MUS8e
— Dave Portnoy (@stoolpresidente) March 2, 2021

Portnoy is a shareholder in the company that created the index that underlies the fund, a spokesperson for VanEck confirmed, though the company did not respond to a query about whether or not it had a role in the staged press conference.

More to the point, the stunt was also an uncomfortable reminder that one man’s meta meme may be another’s market manipulator.

“This is blurrier than anything else I can think of in terms of who Portnoy is and how what will drive the constituents of the index will be impacted by the stocks he talks about in social media,” said Todd Rosenbluth, head of ETF and mutual-fund research for CFRA. “To be clear, my understanding is that companies are going to make it into the index based on a variety of factors.”

“The product is a little mind-blowing,” said Tyler Gellasch, executive director of Healthy Markets. Gellasch thinks that the ETF “appears to be capitalizing on what could very well be determined by SEC and FINRA to be market manipulation,” he said in an interview.

“People who may have direct influence over the value of the individual securities are involved in the offering of the product. Think of all the potential conflicts of interest and self-dealings you could have, things like potential front-running. Their own Twitter feeds, their own public statements could change the value of the underlying securities and impact the underlying portfolio.”

VanEck did not immediately respond to those concerns, either.

Original article from Market Watch