Episode summary
Compoundr ETFs, Closures, and “ETFs Going Hollywood”
ETF Prime
· · Hosts: Nate Geraci, Simeon Hyman · Guests: Alex Morris, Roxanna Islam
Summary
The episode focused first on the rise of “ETFs going Hollywood,” where well-known managers and market personalities are using their brands to launch actively managed or 13F-mimicking ETFs. The guest argued that with nearly 4,500 ETFs in the market, attention and storytelling have become a real competitive advantage, helping newer funds stand out even with higher fees, concentration risk, or lagged replication. The conversation framed these products as more suitable as satellite positions than core holdings, especially because investors are often buying the manager’s reputation as much as the portfolio itself.
The discussion then turned to ETF closures, which the guest described as the less glamorous but equally important side of the business. Closures are concentrated in newer, smaller, often thematic funds, and the guest suggested that niche, hype-driven strategies face the highest risk of disappearing when flows fail to materialize. The host and guest tied that trend to the lower cost of launching ETFs and the industry’s willingness to test many ideas in search of a few winners.
Alex Morris of F/m Investments then walked through the firm’s new Compounder ETFs, which are designed to reduce dividend and interest tax drag by rotating around distribution dates. He said the strategy can also capture some dividend-runup behavior and is intended to be durable, not merely a tax trick. Morris also outlined F/m’s push for a mutual fund share class of its ETFs, saying it would bring ETF innovation to retirement and mutual fund investors without forcing disruptive vehicle changes.
Key takeaways
- The guest said celebrity-driven ETFs are succeeding because brand recognition helps managers cut through a market of nearly 4,500 funds.
- The guest argued that higher-fee “Hollywood” ETFs can still work as satellite positions, but not as S&P 500 replacements.
- ETF closures are concentrated in newer, smaller funds, with thematic strategies showing the most closure risk.
- Alex Morris said F/m’s Compounder ETFs are built to reduce dividend tax drag while preserving bond-market exposure.
- Morris said F/m’s mutual fund share class filing is aimed at retirement and mutual fund investors who want ETF-style innovation without switching wrappers.
Notable quotes
“There's almost 4 and a half thousand of them out there and it's hard to stand out”
“brand and storytelling do matter in ETFs”
“in general I would say they're not core holdings. They're not S&P 500 replacements”
“about 90% of the ETFs that closed this year are relatively newer”
“we fixed income”
How the episode opens
There's been a lot of interest in dividend capture strategies for a long time and there's a lot of literature to point out that you can make money actually through the dividend by buying before getting an increase of price which also doesn't go away right when you sell. All right, joining me will be Alex Morris, CEO of FM Investments, who currently offers 18 ETFs, about $8 billion in assets. They have been a really nice ETF success story, especially when you consider that they didn't launch their first ETF until a little over three years ago.
So, they haven't been around that long, but they're now at that $8 billion in ETF assets, and they're not resting on their laurels. They just launched two very interesting bond ETFs that seek to avoid dividends or the interest from underlying holdings which are actually other bond ETFs. So, in essence, uh, these are highly tax efficient bond ETFs.
And Alex and I are going to walk through those products and then we'll actually switch gears and spend some time getting into the multi-share class structure because FM is seeking to launch a mutual fund share class of their existing ETFs. They're trying to go the opposite direction from many other fund companies who are seeking to launch an ETF share class of their existing mutual funds. So, we'll discuss why they're doing that and uh where everything stands here.
Now, to start this week, I am joined by Roxanna Islam, head of sector and industry research at Vetify, who is going to dive into one of the hottest trends in ETFs right now. And that is superstar fund managers. uh these well-known investment strategists and personalities you see on TV, they're all now getting involved in ETFs and they're basically leveraging their fame to help compete in the ETF terror.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- compoundr series etfs
- dividend tax drag
- mutual fund share class
- etf closures
- etfs going hollywood
Companies and tickers mentioned
- F/m Investments
- VettaFi
Watch the episode
Watch “Compoundr ETFs, Closures, and “ETFs Going Hollywood”” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from ETF Prime
-
Inside the Latest iShares ETF Trends with BlackRock’s Jay Jacobs -
Anthropic IPO & Bitcoin DRIP ETFs -
Baird Strategas’ Todd Sohn on ETFs: What’s New and What’s Next -
The AI Trade: Opportunity, Risk & What Comes Next -
SEC’s Brian Daly Provides an Update on Novel ETFs -
The ETF Stories to Watch for the Rest of 2026
ETF Prime, this episode and its artwork belong to Nate Geraci. Octagon is not affiliated with the show; this page is an independent summary.
