Episode summary
Cambria Global EW 3 ETF and 351 ETF Conversions (GEX) | Meb Faber
The Meb Faber Show
· · Hosts: Meb Faber
Summary
Meb Faber framed the webinar around two themes: a still-strong market backdrop and Cambria’s push to expand its ETF lineup. He argued that foreign stocks, small caps, and value have finally begun to rebound after years of lagging, but he also warned that U.S. valuations are stretched, with the Schiller CAPE ratio near record highs and markets increasingly concentrated in expensive winners.
The second half focused on 351 ETF exchanges as a way to diversify concentrated appreciated positions without an immediate full sale. Meb said the structure can work for liquid stocks and ETFs, but it has strict rules, including a 25% cap on any single holding and a 50% cap on the top five. He positioned the process as especially useful for founders, family offices, and advisors dealing with concentrated stock, and said Cambria has tools and advisors to help determine eligibility.
He also previewed the Cambria Global EW 3 ETF, GEX, launching in November at a 25 basis point fee. Meb described it as a global, non-market-cap-weighted portfolio intended to reduce the “buy high, sell low” problem of cap-weighted indices. Throughout the Q&A, he reiterated Cambria’s broader case for shareholder yield, tax efficiency, and more deliberate portfolio construction over default market-cap exposure.
Key takeaways
- Meb said U.S. valuations are near extreme levels, while foreign stocks, value, and small caps are finally rebounding after years of underperformance.
- He said 351 exchanges are mainly for liquid stocks and ETFs, with a 25% single-name limit and 50% cap on the top five holdings.
- Meb previewed GEX as a global, non-market-cap-weighted ETF launching in November with a 25 basis point fee.
- He argued that concentrated stock is a major risk, especially for founders, family offices, and advisors with appreciated positions.
- Meb said shareholder-yield strategies outperform dividend-only approaches because they account for buybacks and share issuance.
Notable quotes
“we're about to enter the best 12-month period really um and starting in like October, I think”
“we're doing one this fall in November, Cambria Global EDUB 3 ETF, G E X”
“You want to avoid the companies trading a thousand times revenue, whatever”
How the episode opens
Cambria, a day job. Getting ready to cross 4.45 billion. Knocking on five.
You know, this has been um a pretty monster year for us. We have um a lot of funds that are really having some some pretty incredible years. Up 20 25%.
Um you know, this goes back to the paper we wrote a few years ago called uh the bear market diversification where we're really seeing the inverse happen over the last few years where uh former assets like foreign stocks and emerging market stocks and things like value and and small caps are all starting to to rebound and have some pretty explosive returns. That having been said, I don't know if you all know this. If you look at the four This is one of the first papers that we've ever written um was on the four-year in the presidential cycle, 12-month and four-year cycle, and it looks at the market and then small cap over the course of the year.
And we're about to enter the best 12-month period really um and starting in like October, I think. Or really a best six-month period. But with the big big daddy of all the biggest month of of returns of that whole cycle for small cap and and uh small cap value is in January.
So, we'll see if it if it remains true. Anyway, uh it's a special time. We're excited.
You know, us getting uh up up the ranks in assets certainly allows us to try out uh you know, and offer some products uh continued low cost but also some pretty innovative ideas. You know, we're 20 funds now. And so, um it's a it's a pretty eclectic lineup.
You can see a bunch of the ideas. Happy to get into some of those questions as we get into it uh later.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- etf launch
- global ew 3
- 351 etf conversions
- actively managed etf
- cambria
Companies and tickers mentioned
- Cambria Investment Management, LP
- ALPS Distributors Inc.
Watch the episode
Watch “Cambria Global EW 3 ETF and 351 ETF Conversions (GEX) | Meb Faber” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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The Meb Faber Show, this episode and its artwork belong to The Idea Farm. Octagon is not affiliated with the show; this page is an independent summary.
