On Thursday, March 17th, Todd Rosenbluth joined the ETF Trends and ETF Database team as the new head of research. He sat down with Evan Harp to discuss his work, the threads that connect the worlds of baseball and finance, and his journey into the ETF space.
Evan Harp: What is something surprising about you that people wouldn’t discern right away?
Todd Rosenbluth: I guess I’ll take that on a more personal note. I coach my son’s Little League baseball team and his youth basketball team, despite having personally not been a very good athlete as a kid. I’m more of a sports fan than a sports player. Combine that with my passion for my son getting to try to excel.
Evan Harp: What sports are you a fan of?
Todd Rosenbluth: I’m a fan of baseball, football, and basketball. In particular, college sports. I went to the University of Michigan, and I’m a passionate football and basketball and now hockey fan for the team.
Evan Harp: Is that where your sports fandom started?
Todd Rosenbluth: I grew up a sports fan. My father and I watched baseball together. I grew up in New York, so I was a Mets fan. I played till I was 10, maybe, but continue to be a fan to this day. My evening activities are watching sports when I can.
Evan Harp: What inspires you creatively, spiritually, or emotionally?
Todd Rosenbluth: I’m a big believer that people need to make informed decisions. So the work that I’ve done prior to joining ETF trends — and am now continuing at ETF Trends — is to try to educate investors and advisors to learn as much as they can about investments before they put money to work. I find that the world benefits from specialists, so I have a very narrow expertise in a very narrow field. I believe that you should outsource your knowledge. I don’t know how to fix anything around my house, I don’t know how to do lots of things. But what I do know, I want to try to communicate with people, because I know they could benefit from somebody who spends their day job focusing on investments, and in particular on ETFs.
Evan Harp: I’m really struck by the worldview you have of being a full believer in specialists. I’m wondering, how did you come to that? Was it a slowly formulated realization throughout your life, or was there a moment where you realized that humans work better if we all have diverse specializations and combine them to take on a series of situations?
Todd Rosenbluth: Yeah, I guess it is more of a philosophy than I realized. My wife and I bring different strengths to our family. She’s very good at certain things and just comfortable letting me take the role in other capacities in our family. I live in a New York City apartment where I know I don’t know how to fix things. I would rather not learn how to fix things. There are people who work in the building who are very happy to be compensated for doing those things, and life is hard enough to be good at one or two or three things. I think I’m good at talking about investments in a clear and concise manner, and let other people do what they’re good at. So to connect it to our world, let the advisor who builds relationships with clients focus their time on that and leverage the capabilities that our platform brings.
Going somewhat full circle on this, my first job out of college was as an advisor. I was an unsuccessful advisor because I wasn’t very good at the sales aspect, the relationship-building. I wanted to spend more time doing research on investment ideas. So I found a career that let me focus on that and let other people build relationships with the end investor.
Evan Harp: That’s fascinating! I’m going to give you one more non-ETF question. What profession other than your own would you like to attempt, all real-life obstacles aside?
Todd Rosenbluth: Oh, yeah, I mean, in an unrealistic way, I still would like to be that 10-year-old kid who hadn’t yet realized he wasn’t good enough on his baseball team to continue playing. So it would be a dream to be playing for the New York Mets. That’s my team. I was a catcher at a very young age and loved it, and would love to be catching Jacob deGrom’s pitches.
That’s not realistic. If I could do something that was slightly more realistic… I don’t know. I love what I do. So I throw myself into it. I don’t have a passion to do something beyond that, which is a cop-out answer to the to the question. So maybe that’s not the right answer. It’s the right question to ask me, but I’m not answering it in a way that’s informative.
Evan Harp: No, I think that that’s informative. I think that it says a lot about you. A lot of people have the secret dream job, but it sounds to me like you’re somebody who found your secret dream job and you feel really comfortable in that space and doing what you’re doing. I noticed you talk about having a lot of sports fandoms. But you circle back to baseball a lot. What is it about baseball that you find particularly compelling compared to other sports?
Todd Rosenbluth: Well, what I love about baseball that other people probably don’t is that it’s every day. Well, there’s a day off here and there, but I love that it’s 162 games, you have to show up every day, you’ve got to put in the effort, there’s no breaks in between. It’s a grind. It seems that way for the players, and it is that way for the fans. You’ve just got to trust that the next day will be better if you lost, and hope that it will continue if you win. I love that it’s constant.
I like also, for my son who’s playing in it, that you’re both an individual and a team member. You’re an individual when you’re at bat, but you’re a team member when you’re in the field. There’s a chance to shine, but also, you’ve got to be a part of everything. Everybody’s involved on the field, and well, I guess everybody that’s on the field is part of it. It’s all-team. But I like that there’s an individual spotlight for a chance to succeed or fail and learn from the failure in baseball. This is actually very thought-provoking, or I’m being much more introspective than I normally am.
Evan Harp: I think baseball does that. It’s such an interesting sport for that because it is structured in a way that’s unlike any other sport. If you think about it, every other sport is essentially a variation on soccer in some ways, right? There’s a goal, there’s a time limit. Defense protects the goal, offense attacks it with the ball. In baseball, the defensive team controls the ball instead of the offensive team. Because it’s so different, how people plug into it is always an interesting thing to me.
Before getting lost in baseball talk forever, I’d love to talk about your general background. You mentioned being an advisor. Can you talk a little bit about your your first break in the ETF space and what that was like, and maybe when you realized that this was the space for you?
Todd Rosenbluth: So I guess a slight bit of a detour further back. I was a financial advisor, it didn’t work out, I then went into the mutual fund data and research or commentary world. That also didn’t work out. Being an advisor didn’t work out, because I wasn’t good at it. Being a mutual fund oriented person didn’t work out because the company I was with stopped being committed to the focus on it. So I then shifted to focusing on individual stocks and doing research on individual stocks.
At that same company, I found a different opportunity within the company. That company was S&P Global. About five or six years into my job there, the company then decided to take another crack at focusing on mutual fund research and then, secondly, ETF research. I got assigned to help out on the mutual fund side, and somebody else got assigned to handle the ETF side.
I came to realize that what they were doing was more interesting. The money was going into ETFs, away from mutual funds. This was 2010. So it was as ETFs were starting to get their sea legs and grow. I made the case internally that I should do both those jobs and then made the case internally that it should be my full-time job instead of being a stock analyst. I was successful.
I saw ETFs as a great way to tell stories and communicate an investment perspective, much more than mutual funds because they’re mostly index-based. They can be much more targeted with what they’re providing exposure to, so it lends itself into educating about an investment style or theme. Unlike a mutual fund where you’re assessing the manager and then that manager’s interpretation of that potential theme, ETFs were just more straightforward and easier to understand and thus easier to communicate about. It’s been my full-time job for the last eight years.
Evan Harp: I really respond to the answer that ETFs are better at telling stories. Because when most people think about investments, they think about numbers, right? They just think about stats and numbers going in this direction or that direction and see finance through its more technical lens. So it’s interesting that you find ETFs are a vehicle for story within the market.
Todd Rosenbluth: I think they’re better vehicles to be able to say “I have a view on x.” And then the ETF is a better way of getting exposure to that. So, “I believe that healthcare is going to outperform,” the ETF is an easier way of doing that.
So the story connection to it is being able to explain why. Why do I think it’s going to be better, and why is this the right track to be able to go? As someone who publicly speaks about ETFs, it’s easier that there’s a direct line to it.
Evan Harp: That gives me another question: Speaking about this publicly has got to come with its own set of pressures. How do you handle the pressures of being on the record about so many different things? The markets can always be surprising, so how to tackle the stakes that come with talking about ETFs in the public arena?
Todd Rosenbluth: I guess a couple of things. One is, that I’m comfortable that I know as much or more than the person whom I’m talking to about the topic. I’ve learned enough about it, and it’s what I do on a day-to-day basis, so if it’s a reporter who’s asking me a question, then they’re looking to me for expertise. If it’s an end investor or client, they’re looking to me for expertise. It’s very rare that someone’s trying to get me and try to use my answers against me. So I trust that what I’m going to say is going to be what I think, and I’ve always been happy to be in a place where I can say what I think instead of having to parse my words.
I also just feel like it’s okay to be wrong. You can give your best opinion and have data to back up the reasons why you think something, but with a belief about investments, sometimes people are going to be incorrect. This is my best answer today. The facts are going to change, my opinion might change as a result of that, and I trust that what I’m saying, I stand behind.
Evan Harp: It’s also got me like thinking again about the philosophy of specialization. You have all this information and research that you’ve steeped yourself in that the average person has not. And so you trust yourself to be the conduit by which other people can get this information.
Todd Rosenbluth: I’m ignorant enough to know that I might not know the answers, and if that’s the case, I’ll then say, “I don’t know.” This sounds weird, but I’m talking to you, and I realize that you’ll use the words and it’ll get published, and then more people will read it. But I don’t think about that part of it. I think that I’m talking to you. In the same way I think I’m talking to somebody on camera, I just don’t really think about who else is there, which makes it so I’m not nervous about what I’m saying. I don’t know why, it just is.
Evan Harp: It’s a lot easier to have an audience of one than it is to have a whole crowd, so that makes total sense to me. What are you most interested in or looking forward to in the ETF space throughout the rest of 2022?
Todd Rosenbluth: Well, I guess, two ways of answering it. I’m excited that despite what’s going on in the market, that investors keep turning towards ETFs. They did that in record droves in 2021, but even to start the year, which has been much more volatile, investors keep turning to ETFs as the way to get exposure to the market, which just gives me comfort that more people are understanding enough about ETFs. So that’s more of a blanket answer — I just think that the industry is going to continue to grow.
I’m particularly excited about the fact that we now have many more actively managed ETFs, which is going to be counterintuitive to my earlier comments that ETFs are easier stories to tell when they’re index-based. Investors often don’t trust themselves to make informed decisions, so they are comfortable, again, turning to an expert. If they can find an expert in a relatively cheap, relatively easy-to-understand investment style and can latch onto them to be their management partner, to help advisors build portfolios, they’re going to do that.
I think we saw that in years past with ARK having success, but the fact that we’ve got so many more new actively managed ETFs that have come to market in the last couple of years — and I think more will come in the next couple of years — is exciting to me because large asset managers entering the ETF market is good for everybody.
Evan Harp: So, one more question. Why did you join ETF Trends and ETF Database?
Todd Rosenbluth: I’ve respected ETF Trends and ETF Database within the industry, I’ve had the pleasure of doing educational events with… I guess we’ll name them all, Tom Lydon, Lara Crigger, Tom Hendrickson, and Dave Nadig. So, the opportunity to be able to work with them, and the opportunity to work more directly with advisors and specialize in the ETF space [was why I joined.]Where I came from was a broader investment research firm where I was the ETF specialist. I’ve now come to a home that is focused on the ETF marketplace, and I get to be part of a strong team of specialists. So going back to the team aspect of it, but being specialized, I guess, connecting the dots to the earlier parts of the conversation.
Evan Harp: That’s excellent. We’re so happy to have you on our team!
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