Remy Blaire engages in a thought-provoking discussion with Simeon Hyman, the Global Investment Strategist at ProShares. The conversation centers around the current investment landscape, which has been characterized by volatility and unpredictability, particularly in the year 2025.
Remy opens the segment by highlighting the challenges investors face, including tech booms, price swings across various asset classes, and the constant disruption caused by factors such as artificial intelligence and global shifts. She introduces the concept of Ex-Sector ETFs, a strategy that allows investors to step back from specific industries when risks rise without abandoning the broader market.
Simeon celebrates the 10th anniversary of ProShares’ Ex-Sector ETFs, explaining how these funds work by allowing investors to eliminate exposure to a particular sector of the S&P 500. He details the available options, including SPXT (Ex-Technology), SPXE (Ex-Energy), SPXV (Ex-Healthcare), and SPXN (Ex-Financials). Simeon emphasizes that many investors typically have a view on one sector rather than the entire market, making these ETFs a straightforward tool for managing risk.
Throughout the segment, Simeon provides practical examples to illustrate the utility of Ex-Sector ETFs. He discusses how an investor with a bearish view on the energy sector can exclude it from their portfolio, especially when oil prices are declining. He also addresses the significant weight of the technology sector in the S&P 500, suggesting that while it may be tempting to eliminate it entirely, investors can use the Ex-Technology ETF to adjust their exposure without completely abandoning their tech investments.
Remy and Simeon also explore the importance of considering one’s employment sector when making investment decisions. Simeon points out that for individuals working in sectors like healthcare, where their income stream is substantial, it may be wise to reduce their investment exposure to that same sector to diversify their risk.
As the conversation shifts to broader market dynamics, they discuss how political factors, such as regulatory changes and tariffs, can influence investment strategies. Simeon cautions against assuming that sectors are undervalued simply because they appear cheap compared to technology, advising investors to remain mindful of the political landscape, particularly in sectors like healthcare.
The segment also addresses the scenario of receiving a large single stock position as a gift or inheritance. Simeon suggests that using an Ex-Sector ETF, like SPXT for technology, can help balance out the exposure without incurring capital gains taxes from selling the stock.