Episode summary
The 80/20 Portfolio, Bipartisan Stocks and Slumpy Septembers | Trillions
Trillions
· · 14 min · Hosts: Eric Balchunas, Joel Weber · Guests: Athanasios Psarofagis, Isabelle Lee
Summary
The episode centers on three ETF data signals: the shift from the classic 60/40 portfolio toward something closer to 80/20, the surprisingly bipartisan overlap in lawmakers’ stock holdings, and the strange seasonal pattern where September is usually weak for markets but busy for ETF launches. The guest argues that the modern portfolio is far more equity-heavy than investors may realize, with bond ETFs shrinking as a share of assets while buffers, covered calls, crypto, and money market funds absorb some of the old bond role.
On political portfolios, the guest says the Republican and Democratic tracking ETFs are more novelty than institutional scale, but the overlap in holdings is the more interesting story. Stocks such as Intel, Amazon, and CrowdStrike appear in both camps’ baskets, and a basket of those shared names would have outperformed the partisan versions. The host and guest frame the products as a way to follow lawmakers’ trading activity rather than a pure political bet.
The final segment says September’s weak seasonality has held up, but it does not deter issuers. The guest points to bond mutual funds as the real risk area to watch: rising yields can pressure net asset values, trigger outflows, and create a doom loop. The host adds that ETF launches are likely to keep coming unless there is a much harder market break.
Key takeaways
- The guest says ETF assets have shifted from roughly 60/40 to about 80% stocks and 20% bonds, largely because equities have rallied and investors have soured on bonds.
- The guest argues that money market mutual funds and bond alternatives may push the real cash-and-bond mix closer to 20/30 than 80/20 if they are counted.
- The guest says the bipartisan overlap in lawmaker portfolios is more interesting than the party-specific ETFs, with Intel, Amazon, and CrowdStrike held by both sides.
- The guest warns that bond mutual funds, with about $4.5 trillion in assets, could be the place where rising yields spark a “doom loop” of outflows and forced selling.
- The host says September remains one of the worst months for returns, but ETF issuers keep launching funds because they are chasing momentum and first-mover advantage.
Notable quotes
“if you were just build a basket of those, you end up beating everything else”
“the 8020. Okay. So obviously the normal like default portfolio is 6040 right uh but stocks have been on this like tremendous run”
“there are names that are held by both, right? So I know, you know, everyone wants to sort of like politicize everything”
“September is like the busiest month for launches. Uh flows don't really get derailed just because the market's down”
How the episode opens
Bloomberg Audio Studios podcasts radio news. We've looked at performance of Nance in GOP and as you can imagine when there was a Democratic president, Nance was doing better and now GOP is doing slightly better. But I think where it gets interesting is there are names that are held by both.
Wait, there's a middle? — And if you were just build a basket of those, you end up beating everything else. Welcome to Trillions. I'm Joel Weber — And I'm Eric Balchunis.
Eric, we are experimenting with some new formats. This episode's going to be no exception. One of the members of your team who's been a regular on the show is Athanasios Saraphagus, who's a ETF analyst at Bloomberg Intelligence.
There's been a few themes of late that Aan and I discussed previously and we wanted to create an episode that we can come back to again and again with Aan and Isabelle Lee, cross asset reporter from Bloomberg News to kind of like do a little spotlight episode on a few of these themes uh and research notes.
Yeah. So, Aanosios is in my opinion the best chartist on the team. He also is he comes up the things that end up in my powerpoints I think the most and the things where I'm like oh I didn't know that.
So I think just like basically having one week where we just look at his stuff I think is really worthwhile. The other thing is he doesn't like to do media and so I like I like forcing him to do media and that's fun for me.
So those two things combined I'm like — I think we should just sort of go through some of his notes and some of the things he found because he doesn't he's in the in the minds man.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- 80/20 portfolio
- bipartisan stocks
- etf launches
- september market slump
- etf data
Companies and tickers mentioned
- Bloomberg LP
Watch the episode
Watch “The 80/20 Portfolio, Bipartisan Stocks and Slumpy Septembers | Trillions” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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