Global Allocation via ETFs with Jan van Eck

It's a pleasure for us and BTG to have you here and have this partnership with VanEck.

Well, it's a great pleasure to be in São Paulo. Let me start with VanEck's investment philosophy. We think of ourselves as global macro investors. We look at political trends, economic policies, and technology, and ask how that should shape your portfolio. People too quickly say they want a mix of stocks and bonds, but it really depends—if you're in Venezuela, you want stablecoins or Bitcoin. You need to step back and take the big picture. We've been applying this in America for 70 years, but it's older in Europe. History is key—it shows how quickly the world can change. VanEck also has a big commodities business; my father started the first gold fund in the US. That ties us into the global economy, not just a US perspective. We have a large investment team and use quantitative techniques for signals on momentum and asset allocation.

I start with two fundamental things: what are the 10-year trends—big picture changes like the rise of China for 30 years. Then you assume the market is efficient. 10-year themes drive asset allocation. Our themes include AI, the rise of India, and gold—which I think is re-emerging as a leading currency because central banks are buying it as a store of value. For shorter-term themes, you need higher conviction because the market is efficient. For example, our nuclear ETF—we started it 19 years ago, and it's now benefiting from AI-driven electricity demand and global policy shifts. You also need to know when to sell by looking at valuations. Our semiconductor ETF, SMH, is the world's biggest. We did deep research and sold when Nvidia was at 50 times sales in summer 2024, then bought back when it became fairly valued. So, start with 10-year trends, then use themes with valuation discipline.

Our philosophy is pure play: at least 50% of companies in an ETF should be related to the theme. For example, a Brazil ETF should include companies like Nubank and Mercado Libre that do most of their business in Brazil, even if they're listed elsewhere. That solves 90% of the problem. Sometimes the world changes—like private credit after the financial crisis. Now there are 25 public companies, so we created an ETF. Not every ETF should be bought all the time; they go through cycles. Our approach is to explain how we see the world and let clients pick.