Investors looking to back major market indices without inadvertently supporting Elon Musk's ventures now have a new option. Two novel exchange-traded funds (ETFs) have been introduced, explicitly designed to exclude companies that are founded, controlled, or led by the controversial entrepreneur. This means that for the first time, investors can track the performance of the Nasdaq-100 and S&P 500 indices while sidestepping firms such as Tesla and SpaceX.
The new funds, named the Nasdaq-100 Ex-Elon Enterprises ETF (QQNE) and the S&P 500 Ex-Elon Enterprises ETF (SPNE), are registered by Tidal Trust I and branded under Subversive Markets Lab LLC. Their creation addresses a growing sentiment among some investors to avoid companies associated with Musk, citing various public controversies, from his comments on X (formerly Twitter) to his involvement with Dogecoin.
For the average investor, avoiding Musk's companies has become increasingly difficult, particularly as firms like SpaceX gain prominence in major indices. SpaceX, for instance, has recently been added to the Nasdaq 100, and is also included in the FTSE Russell and MSCI indexes. Tesla, a long-standing favourite in large-cap and growth mutual funds, is another key holding in many diversified portfolios. The Ex-Elon ETFs are specifically structured to filter out these prominent companies from their portfolios.
According to the filing with the U.S. Securities and Exchange Commission, the excluded enterprises currently include Tesla (TSLA) and Space Exploration Technologies Corp. (SPCX). The funds' mandate also allows for the exclusion of other companies that may become closely associated with Musk in the future, aiming to block any enterprise where he is a founder, controller, leader, or otherwise primarily associated. This proactive approach ensures the funds maintain their 'Musk-free' investment thesis.
The launch of these ETFs by Subversive Capital, an exchange-traded fund creator known for its unconventional offerings, signals a niche but potentially significant demand in the investment landscape. While it remains to be seen how widely these 'Ex-Elon' funds will be adopted or how they will perform compared to their inclusive counterparts, they certainly reflect a notable shift in investor sentiment and offer a distinct choice for those aligning their investments with their personal values.