Good morning and happy Wednesday.
Here’s some not-so-saccharine news.
The global sugar supply may be smaller than previously thought for the coming season. That’s according to the world’s foremost sugar trader, Alvean, which unveiled its forecast last week at New York Sugar Week, Bloomberg reported. That’s right — there is a sugar week, and it is in New York. Behind the likely shortage are weather risks and transportation issues in Brazil, which grows much of the supply. That could in turn raise prices, contrasting with a recent historical low for raw sugar futures earlier this month, according to the publication.
It appears that there is but one US-listed ETF focused on sugar — the aptly-tickered CANE, or the Teucrium Sugar ETF. Time will tell if the recent news leads to flows for the $10 million fund.
AI-Built Indexes for Anyone: Cuter, Cheaper and Maybe Riskier
Is anything safe from AI?
Investing could soon become more interesting, at least for anyone willing to give a few prompts to an artificial intelligence service recently introduced by broker-dealer Public. With a few clickity clackities on the keyboard, curious investors can make their own indexes, which Public says they will be able to track shortly. The service not only assembles an index, but also gives it a cute name and backtests performance compared with broader market returns. That, and it avoids the fees for mutual funds, ETFs, or direct indexing that people would otherwise have to pay. But are those features enough to threaten a slice of the more than $10 trillion-dollar ETF business?
“AI-driven platforms like Generated Assets and Composer are definitely catching more attention — and yes, I do see them starting to shape how younger, tech-comfortable clients want to invest,” said Daniel Milks, founder of Fiduciary Organization and Woodmark Advisors. “We’ve already seen clients jump into algorithm-driven strategies without understanding risk exposure, correlation, or tax implications. These platforms can easily steer assets away from well-structured ETFs or diversified funds and into hyper-niche positions that look good in a backtest but fall apart in real life.”
Felt Cute, Might Invest Later
Axios’ Felix Salmon pointed out a flaw in backtesting indexes — that the current weightings of each stock in a creative index will not match what they were years ago, which can lead to wildly inaccurate performance figures. And, as any fund would disclose, past performance doesn’t guarantee future returns.
ETF Upside played around with Generated Assets to build a few indexes:
- Breakfast Champions, which tracks cereal producers and distributors, reportedly returned 58% since 2015, compared with 148% for the S&P 500.
- Sole Providers: Shoe companies returned 175% over 10 years.
- Remote Work Champions: Companies with such policies reportedly returned 594% since 2015.
- CEOs Starting with Q: This broke the system, which couldn’t find any public companies led by people whose first names start with the letter Q.
Human Nature: Whether curious investors experience more perks or pitfalls from AI-enabled strategies may depend on their experience and skill. “For thoughtful investors who use these tools wisely, it can enhance decision-making and improve outcomes. But the very same tools, when misused or misunderstood, can accelerate mistakes,” said James Vermillion, founder of Vermillion Private Wealth. “AI can assist in constructing portfolios, but it won’t immunize anyone from panic, greed, or short-term thinking.”
Stock ETFs From Allspring Help You Take Action Now
Allspring’s equity ETFs transcend standard indexing. These actively managed funds aim to deliver benchmark-beating performance in all environments, even in volatile markets — leveraging the firm’s extensive experience, deep research, and proprietary portfolio construction techniques. The strategies, led by portfolio managers with deep domain expertise, include:
- The Special Large Value ETF (ASLV) uses a high conviction, CPA-based approach to value investing — targeting fundamentally undervalued companies with strong balance sheets.
- The LT Large Growth ETF (AGRW) invests in a select group of growth names identified as having superior, durable fundamentals across four distinct growth classifications.
When it comes to Allspring, “active” doesn’t need to mean “expensive.” The firm’s ETFs combine longstanding institutional insight with the tax benefits, liquidity, transparency, and cost-effectiveness of the ETF format. Whether you’re seeking value, growth, or a foundational addition to your core portfolio, Allspring’s approach aims to deliver conviction, consistency, and discipline.
Explore Allspring’s active equity ETF suite.*
*Carefully consider a fund’s investment objectives, risks, charges, and expenses before investing. For a current prospectus and, if available, a summary prospectus, containing this and other information, visit allspringglobal.com. Read it carefully before investing.
Investing involves risk, including the possible loss of principal. Allspring ETF Funds are not available for distribution outside of the United States. Allspring Funds Distributor, LLC (Member FINRA/SIPC).
SEC ‘Housecleaning’ Collides with Shifting Regulatory Priorities
The SEC is embarking on an ambitious agenda to expand access to digital assets and private investments, recently confirmed Chairman Paul Atkins said this week. The only potential hiccup, which is no small matter, is that it just lost 15% of its staff.
“It’s good every now and then to have a housecleaning,” Atkins said Tuesday during a House subcommittee hearing. “These were all voluntary retirements. Some people took the buyouts” offered by the Trump administration, he added. His plans for the SEC may not require doing more with less, however. In some cases, doing less with less is the point, particularly as it relates to actions the Securities and Exchange Commission takes against companies. Atkins has made clear that during his watch, the regulator won’t be taking a “regulation by enforcement” approach, as it had been accused of doing under Biden administration Chair Gary Gensler.