Similarly, millennials are more likely to embrace the ETF than stocks, bonds, mutual funds or alternatives, said O’Leary. “Millennials will not invest in active management.”
Since millennials tend to be risk averse and skeptical of investing, O’Leary suggested they might be interested in his O’Shares ETFs. Launched in 2015, the ETFs are built on indexes custom-made to suit O’Leary’s family trust, which has strict rules regarding investment concentration, quality, volatility and yield.
In discussing the steps it took to launch O’Shares, O’Leary’s potential as a spokesman for the ETF industry became clear as he waxed poetic about the virtues of the asset class: transparency, efficiency and liquidity.
O’Leary described ETF formation as a blend of art and science. While the science involves the technical skill to launch the product, the art is found in index formation, particularly around the challenge of picking high-quality companies.
“The art of creating an ETF around the concept of quality is exactly that,” O’Leary said. “The definition of quality is different for every manufacturer. The innovation in the ETF industry is going to be around the concept of quality.”
O’Leary also left the Inside ETFs audience with a hint that his future may very well involve more than investing and reality television—he confirmed that he intends to run for the leadership of Canada’s Conservative Party.
“I’m going to make Canada wonderful,” said O’Leary, combining Donald Trump’s 2016 campaign slogan “Make America Great Again” with his tongue-in-cheek reality TV nickname.