[paulgb]

I wonder if there's a market for a financial product that looked at your ETF holdings and allowed you to cancel out a particular instrument. I don't have the appetite to be net short, but there are stocks I'd like to negate my ownership of.

[wcoenen]

Thanks to automation, fractional shares and zero commissions, "direct indexing" is a thing now. You can track an index of your own design instead of trying to cancel out positions.

[paulgb]

Interesting, thanks for the pointer to that phrase, I'm reading up on it now.

Are there products that make it easy to do this? I imagine it would be theoretically possible but incredibly time-consuming to keep up with SPY by manually trading on RobinHood!

[wcoenen]

I believe the products that make it easy are currently only available through financial advisors, and for high net worth clients. But the demand seems to be there, so something accessible to the average retail investor may appear in the next few years.

[AndrewBissell]

This is a really intriguing idea! You would of course run into the issue that that product would appear to have horrible returns right up until the rug gets pulled out, and liquidity might be an issue (margin for the short would have to be provided and presumably could not be directly provided by the long positions). But at the very least one could theoretically write something which could take in a portfolio of ETF positions and output "short this much ABC and XYZ to be net flat in those stocks."