This is one of many ETFs today that let investors piggyback on the stock-picking skill of notable Wall Street personalities.
But that naturally raises the question: Does this make Tom Lee's ETF better than a simple S&P 500 or Nasdaq-100 index ETF? Here's what you need to know before investing in this ETF as a beginner.
Exchange-Traded Fund (ETF)
What is Fundstrat Granny Shots US Large Cap ETF (GRNY)?
GRNY is an actively managed ETF, which means it doesn’t track an index. Instead, every stock in the portfolio is hand-selected by Tom Lee and the Fundstrat research team based on their expectation of outperformance.
The name “granny shot” comes from a basketball metaphor. Just as Rick Barry’s underhand free throw was unconventional but highly effective, Fundstrat aims to build simple, repeatable strategies that improve long-term returns.
This ETF divides its ideas into long-term themes and short-term themes. Short-term themes span six to 12 months and include factors such as:
- Style tilts: favoring growth, value, momentum, or quality depending on the cycle.
- Seasonality: recurring patterns in market leadership.
- PMI recovery: overweighting sectors that historically outperform when economic data turns upward.
Long-term themes run on three- to five-year horizons and include areas like energy, cybersecurity, millennial consumer spending, improving global labor supplies, and easing financial conditions.
Within each theme, Fundstrat performs bottom-up stock selection to build a concentrated portfolio that it believes carries the highest probability of outperforming broad market benchmarks.
How to buy Fundstrat Granny Shots US Large Cap ETF (GRNY)
- Step 1: Open your brokerage account: Log in to your brokerage account where you handle your investments.
- Step 2: Search for the ETF: Enter the ticker or ETF name into the search bar to bring up the ETF's trading page.
- Step 3: Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this ETF.
- Step 4: Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Step 5: Submit your order: Confirm the details and submit your buy order.
- Step 6: Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Should I invest in Fundstrat Granny Shots US Large Cap ETF (GRNY)?
Before investing in this ETF, ask yourself whether you believe in Tom Lee’s stock-picking process.
While Fundstrat does outline the broad rationale behind each theme, the specific decisions that determine portfolio construction remain something of a black box compared to transparent, rules-based index ETFs.
You also need to be comfortable with:
- Concentration risk (only 39 holdings).
- A clear large-cap growth bias.
- A heavy U.S. allocation.
If you want broad diversification and predictability, an S&P 500 ETF will be simpler and remains one of the best types of ETFs to buy. But if you want a high-conviction, theme-driven strategy managed by a well-known Wall Street research team, this ETF may fit your portfolio.
Does Fundstrat Granny Shots US Large Cap ETF (GRNY) pay a dividend?
No. Although some of its holdings pay dividends, many are growth-focused companies that do not. The ETF’s 0.75% expense ratio typically offsets the small amount of income generated.
Expense Ratio
What is Fundstrat Granny Shots US Large Cap ETF (GRNY)’s expense ratio?
An expense ratio is the annual fee charged by the ETF to cover management and operational costs. This ETF's expense ratio is 0.75%, meaning an investor pays $75 per $10,000 invested each year.
This is high relative to index ETFs but typical for actively managed, theme-driven strategies. It is also a major hurdle to long-term ETF outperformance, since fees compound against investors over time.
Related investing topics
Fundstrat Granny Shots US Large Cap ETF (GRNY) Historical Performance
One Month | Three Months | Six Months | Year to Date | |
Market Price | 4.00% | 10.69% | 36.57% | 30.21% |
Net Asset Value | 3.90% | 10.70% | 36.28% | 30.12% |
S&P 500 | 2.34% | 8.23% | 23.60% | 17.52% |
The bottom line on Fundstrat Granny Shots US Large Cap ETF (GRNY)
This ETF will likely perform well during strong bull markets, especially those led by large-cap growth stocks. But investors should also expect high downside risk during bear markets due to its concentrated, unhedged, long-only approach. This is a conviction-based ETF, not a defensive one.
