Thesis: At DASTA Investments ("dub Capital"), we recognize that politicians possess a distinctive vantage point on publicly traded companies and legislative changes that may impact these entities. Our firm is convinced that these unique insights create a remarkable opportunity for politicians to effectively navigate the world of public companies and investment management. Given the mandate for public officials to divulge their holdings in publicly traded companies, we believe there is substantial merit in formulating a portfolio that mirrors the investment positions of select prominent officials.

Portfolio Construction: In our pursuit of constructing this distinctive portfolio, dub Capital follows four principles:

1. Prioritizing recent politician trades: We place greater weight in stocks that have been recently transacted.
2. Emphasizing larger trades: Larger politician trades receive more weight in the portfolio.
3. Focusing on less mainstream equities: DASTA Investments gives precedence to those stocks that aren’t heavily traded by the general investing community, believing that such equities better reflect the unique insights of politicians.
4. Portfolio simplicity: to keep portfolios understandable, we remove small positions.
5. Diversification: to lower portfolio risk, we take steps to limit the weight of politicians’ largest trades.

Politicians’ options trades and stock trades are both used in portfolio construction, e.g. the politician buying stock or call options is considered a bullish signal for that stock, leading to higher portfolio weights for that stock, while selling stock or buying put options is considered bearish and leads to lower portfolio weights.

Risks: This portfolio primarily comprises stocks and is susceptible to the inherent volatility and potential declines that characterize the stock market. Additionally, as this portfolio is based on the trading activities of politicians, it may adopt riskier positions over which we have limited control. It is important to note that replicating a politician's trades is not without its challenges. The lack of granular details in stock trade disclosures makes it impossible to precisely mimic their trades. Moreover, not all financial transactions are publicly reported, and politicians can wait as much as 45 days after transacting to file their trade report. This means that our awareness of a politician's trade often lags significantly behind the actual transaction. Delays may also occur between the time a trade becomes public knowledge and its incorporation into this portfolio. Finally our ability to trade some stocks, particularly small-cap and some ADRs, may be limited due to limitations by our executing broker dealer.

Portfolio updates (12.26.23): DASTA Investments changed its data sourcing method in order to improve our handling of politicians’ option trades.

Nancy Pelosi Backtest

• Backtest Period: May 25th, 2016 - September 26, 2023
• Backtest Avg. Returns: 19.4%

Tommy Tuberville Backtest

• Backtest Period: July 26, 2021 - August 14, 2023
• Backtest Avg. 16.7%

Dan Crenshaw

• Backtest Period: December 8, 2021- March 22, 2024
• Backtest Avg: 29.1%

Josh Gottheimer

• Backtest Period: September 17th, 2019- April 17, 2024
• Backtest Avg: 29.77%

Kevin Hern

• Backtest Period: March 18th, 2020- April 17, 2024
• Backtest Avg: 40.97%

The following analysis contains simulated or hypothetical performance results that have certain inherent limitations. Unlike actual performance records, simulated results do not represent actual trading and may not reflect the impact of material economic and market factors on decision-making.

The backtested results are based on our access to the available dataset at the time of the analysis. The backtest period is determined by the historical data made accessible to us, and as such, the results are contingent on the completeness and accuracy of this dataset. Users should be aware that the backtested period may not encompass all market conditions, and the results may be sensitive to the specific time frame under consideration.

Additionally, it's important to note that past performance is not indicative of future results. The results are provided for informational purposes only and should not be considered as investment advice. Actual performance may vary significantly from the simulated results. Users are advised to exercise caution and conduct thorough research before making any investment decisions.