Hardeep Walia and his company, Motif Investing, aim to take the complexities of stock trading out of the process for average investors.
“Motif is a way to invest the way you think,” Walia explains. “What we do at Motif is make those ideas and thoughts actionable.” The company does this by creating baskets of up to 30 stocks thematically linked by one of those ideas. The baskets are called ... you guessed it … motifs. One key advantage for consumers is the ability to invest in one motif for the cost of a single stock transaction instead of having to pay for 30 transactions to build their own motif.
“Our customers like to think of these motifs as their own personal ETF,” Walia notes. “Except, unlike an ETF, which is a fund, these are individual baskets that you can actually tinker, change or even build your own.”
In addition, investors can buy in dollar amounts rather than share counts. For investors who don’t spend their days on Wall Street or behind a Bloomberg terminal, it might make more sense to buy $1,000 of Apple rather than 10 shares or (at the moment) $940 of the stock.
Now, thanks to a new partnership, Yahoo Finance users will be able to track some of the motifs offered by the company. We spoke with Walia about three of them.
This basket of stocks includes names like Facebook (FB), Amazon (AMZN) and Equity Residential (EQR). “Millennials are driving everything right now,” Walia says. “Millennials are roughly 25% of the population. They’re 39% of renters, hence Equity Residential. They spend 58% of their money online, so Amazon makes sense. They’re the digital natives, [so] Facebook makes sense."
Chinese Internet motif
Walia says that while the millennial motif is up 8% year over year, the Chinese internet basket is a bit more volatile, down 16% over the last year. This group of stocks includes names like Alibaba (BABA), Baidu (BIDU) and NetEase (NTES).
Despite volatility in the space, “a lot of people are watching China because they’re waiting to see what’s going to happen with the restructuring of debt,” Walia says. “A lot of people have anticipation around new changes coming out of China.”
Digital dollars motif
From new technology like Paypal (PYPL) to old guard companies like Visa (V) and Vantiv (VNTV), this motif aims to capture some of the alpha within the $1.6 trillion payments industry. “What people don’t realize,” Walia notes, “is this is an under-penetrated market. We think this area has a lot of potential, and one of the big things related to the earlier motif is China is opening [its] card markets this year. So there’s a lot of interest.”