David Orr

The Militia Long/Short Equity ETF has launched! The ticker symbol is $ORR and it just began trading. The strategy is similar to my hedge fund, investing in global stocks up to 150% long and 100% short. This strategy will typically have lower correlation and beta to the market than most public investments. This means that during a strong bull run $ORR will have a tough time keeping up. But in a weak market $ORR is expected to outperform. My reasons for launching $ORR rather than growing my hedge fund: Many of the investments in my hedge fund are illiquid and I won’t be able to trade them if my hedge fund grows too big. This is why I’ve been turning away new investors. However, well over half of my bets scale well and $ORR will invest in that portion. The $ORR ETF will have a lower edge due to its larger scale, and thus it has a much lower fee to match. I have a strong opinion that hedge fund fees are incompatible with large AUM generally, not just for my fund. Most people don’t know it but Buffett pointed out that even Berkshire’s track record would have been mediocre with hedge fund type fees. This is by far the biggest reason I want to launch an ETF. I want to do right for the people investing with me, who are trusting me with their money, rather than sell out like most other hedge fund managers do. The $ORR ETF has less risk than my hedge fund because it uses less leverage and isn’t short many microcap stocks, which can have extreme volatility. This is a more appealing product to risk averse investors. The ETF vehicle has many benefits: Simplified, favorable taxes for the ETF holder. Can be owned on margin and in retirement accounts. Daily liquidity. Due diligence on ETFs is simpler than hedge funds, convenient for institutional investors. Compliance isn’t an issue for institutional investors. Allows me to rebalance longs without a tax hit. Both very small and very large investors can join, neither of which could invest in my hedge fund. Expenses stated in the prospectus: The 1.3% management fee is accurate, which is around .65%/year fee per 100% gross leverage managed. The 18.84% gross expense ratio is very misleading. These items cause the stated expenses to be very high but are not real economic costs: 1. When a stock or ETF that I’m short pays a dividend it gets counted as an expense. In reality, whenever dividends are paid the underlying stock or ETF drops by roughly the same amount. Thus, the real economics are neutral. The ETF will be heavily short high dividend investments at the start. 2. When I short a stock or an ETF, I am paying to borrow the shares. On average, my larger scale shorts cost 1%/year to borrow. This is considered an expense. However, when I short sell I am simultaneously borrowing shares from one guy and selling them to someone else. That someone else pays cash for these shares, which the ETF holder earns interest on. Thus, I will be earning a positive carry on that short. But the way the “expense” gets calculated, the interest earned from being short does not offset the cost of borrowing. 3. The margin interest paid for being over 100% gross long. Unlike the first two items, this is a real expense but the expected return of the stocks we own is higher than the interest cost. Frankly, the way the expense ratio gets calculated in the ETF prospectus is nonsensical. Regulators should update this number to better reflect reality. But since they don’t, and since most people do not understand this, ETF managers are reluctant to do anything in their portfolio that causes this official number to go up. Well, I say to hell with that. I’m just going to do whatever I think has the maximum expected value even if this hurts marketing to many potential investors. Points about the $ORR ETF at launch: * Until the ETF reaches ~$50-$150 million AUM, I will not be able to short more than 10 individual stocks or ETFs. This is due to the unusual mechanics of short selling in an ETF vehicle and associated implied cost. Thus, $ORR will be shorting mostly bad ETFs in its early days. This isn’t so bad. There’s a big edge in shorting some of these bad ETFs and I even make these same big bets in my hedge fund. But I want to be transparent: the ETF won’t have its full edge until we hit a bit larger scale. * While the ETF has low AUM you should be careful with trade execution. Do not use market orders. You will get the best fills if you use limit orders and buy between 10 AM and 3:30 PM ET. If you're buying in large size, contact your broker and do a Request for Quote (RFQ) to get best execution. Also, if you want to invest >$10 million and want more liquidity, you can reach out to me and I can help coordinate with a market maker. Regulation on public posts, or why I haven’t posted about the ETF until now: Every post I make about the ETF needs to get approval, including replies to questions in this thread. The turnaround time for approval is 5 days and costs money. Thus, I won’t be able to reply to your questions here. Instead, I will gather a list of questions and write up a FAQ. Oddly, I am allowed to reply to questions on podcasts. If you run a podcast and want to discuss the ETF, I’d like to go on. - Thanks to Sam Lee @svrnco for partnering with me on this. Besides financially backing it, there was an awful lot of overhead work and other hurdles when launching an ETF. He did a great job handling most of that work so that I could focus on investing. For more information about ORR ETF, a prospectus, fees and risks militiaetf.com

@joecarlsonshow These are not good investors. You can see that in the numbers.

If you feel bad about unerpeforming the market YTD. Bill Ackmans portfolio is down -8% Dev Kantasaria is down: -20% Chris Hohn is down: -11% These are estimates based on their portfolio at the start of the year. And they show that good investors don't optimize for performance over short time periods. They optimize their portfolios for long-term outperformance.

🚨BREAKING: SUPER MICRO CO-FOUNDER ARRESTED FOR SMUGGLING $2.5B IN NVIDIA GPUs TO CHINA >SMCI co-founder Yih-Shyan "Wally" Liaw arrested today >personally holds $464 MILLION in SMCI stock >charged with smuggling BILLIONS in Nvidia servers to china >used a southeast asian shell company to funnel $2.5B in servers to chinese buyers >$510 million worth shipped in just THREE WEEKS in spring 2025 >built thousands of fake dummy servers to fool U.S compliance auditors >caught on surveillance camera using a HAIR DRYER to swap serial number stickers >coordinated the whole thing over encrypted group chats >SMCI down 12% after hours >faces up to 30 years in federal prison ITS SO OVER…

@memeticsisyphus The woke right, a very short lived political movement.

“War is bad” Ok I’m with you “This war primarily benefits another country at great expense to national treasury and is a danger in spinning out of control.” Yeah I can see that. “And that other country killed Charlie Kirk.” What… “And his wife trafficked children for Epstein.” Huh? “And Epstein worked for that country to black mail every world leader into doing its bidding using baby rape” Ok you’re all retarded. “You’re Jewish”

@luis71294214 @haugejostein Math and physics are a couple of the only exceptions... a few more sure.

I live right next to the US embassy in London. They built an actual moat around it. Who builds a moat around their embassy? Countries that do bad things and expect retaliation. Or countries who do diplomacy as if we’re in the Middle Ages.

@Chapter11Wealth @John_Hempton We are already literally in a state of war. And to your point, it seems that A LOT of people, including many world leaders, don't even seem to realize it. It's insane.

@orrdavid @John_Hempton Your views seem very based on the world being at constant war and a need for everyone outside to be an enemy No co-operation. No frictionless global trade Everyone is an island Countries will be safe from the current shock but by GOD we will all be poorer for it. INEFFICIENT!!

An obvious comment on US Foreign Policy: US foreign policy is self-defeating. a. spend a year beating up on allies, threatening to take land (Greenland) from a NATO ally b. wage a trade war against your allies. Sure the tariffs were illegal - but the beggar-thy-neighbour policy did not engender friends c. start a war of choice in the Middle East. This may or may not have been justified (I lean towards justified) and it may or may not have been wise and winnable (I really do not have an opinion) d. ask your allies for help and e. get upset when they do not oblige - whilst forgetting about a and b above. The geopolitical realignment is astonishing. All my life Australia has had one foreign policy - which is to internationalise the corpses in all American wars. If America asks us to go to war we go. And we go fast. This time the Australian Government (to general approval) has refused to send a ship to the Gulf. (They have not been formally asked - but they made clear a rejection was coming.) After a) and b) above aligning yourself with America is becoming political poison in a democracy. I think this is VERY bad. The world has been well served by the American alliances that won the cold war and mostly kept a functional global order. Those alliances have been sacrificed to Trump's egotistical whims. The world is a less safe place now. And it is less safe not just for America's (former?) allies but also for America.

TLDR: I am a recovering alcoholic with no fund, no credentials, and no lobbyist. I rebuilt myself from nothing. Then I broke into finance with no degree, no pedigree, and no permission. I parsed SEC filings for a $31.5 billion private credit fund called Cliffwater. Not because anyone asked me to. Because nobody else would. The filings are public, but they are buried in footnotes that are not indexed, not searchable, and not structured for analysis. I have been told by fund managers that nobody even attempts this. Billions of dollars in pension capital, and the people who manage money for a living do not bother to read the filings. So I read them. Every loan. Every amendment. Every semi-annual PIK disclosure. 2,330 positions. I hand-researched fifty. I found 189 loans where borrowers are paying interest with more debt instead of cash. I found over 50 loans that are not generating enough cash to service their debt at all — carried at par on the books of a fund that has never reported a losing month in 41 months. The fund's Sharpe ratio is 3.75. Bernie Madoff — who was fabricating returns and could pick any number he wanted — ran a 3.5. He got caught because the numbers were too smooth by Markopolos. The greatest quant fund in history, Renaissance Technologies, runs a five or six. Cliffwater is claiming risk-adjusted returns that would be impossible even if you insider-traded with perfect information every single time, because the volatility of the underlying markets would still prevent it. Nobody asked questions. Bloomberg confirmed 14% redemptions 48 hours after I published. S&P cut the fund's outlook to negative this week. Cash on hand fell 76% in six months. This is not an isolated fund. This is the structure. $9.4 trillion in private equity. $3.5 trillion in private credit. They all pay their own valuation agents. The valuation agents decide what the funds are worth. No valuation agent has ever been fired for saying the number was too high. The marks produce the NAV. The NAV produces the fees. The fees come from pensions. The pensions come from firefighters and teachers and nurses in Oregon and California and Illinois who will never read a private placement memorandum in their lives. Wall Street ran out of rich people. The endowments were full. The sovereign wealth funds were tapped. So they went downstream — to 401(k)s, to retirement accounts, to interval funds sold to people who have no idea what they own. 1. Direct the SEC and FSOC to examine Level 3 fair value practices across interval funds and BDCs. 2. Require that valuation agents be independent of the funds they mark. 3. State publicly that the current self-marking regime creates systemic risk. 4. Mandate position-level mark disclosure for every fund that accepts pension capital. There are two ways this ends. It breaks all at once like 2008 and we fix it. Or it rots slowly like Japan: one fund blows up, six weeks of quiet, another one, and nobody connects it for a decade while a generation of retirees gets destroyed. I am not asking anyone to take my word for it. I am asking them to read the filings. If you know someone in the administration, a regulator, or anyone on a legislative committee, please send this to them. One person learned this from a one-bedroom apartment. Your government can too. The will is what is missing.

I think the war is wise so long as we deny them from getting nuclear weapons. Imagine if today's regime had those. They could make all sorts of insane demands. Remember, the big threat isn't the blockade. It's that they can threaten to turn off the world's oil supply with it in the blink of an eye. If we get regime change, there's a real window for true peace in the middle east. People are cynical about that, but there have been long good stretches in history.

If he achieves regime change in Iran - and the new regime does not try to export revolution, threaten their neighbours and fund terrorists then the war was "wise". I genuinely express on opinion on whether it is wise and winnable. I am too far from any real expertise in the subject.

@John_Hempton This was much needed shock therapy, to wake them the hell up. And of course, nobody likes going through that.

@John_Hempton Genuinely: how can it take so long for world leaders to realize they have to defend their energy supply. To react to the situation. Who cares about the background. They should focus on that key fact set. They should look out for their people. How did we get here?

BREAKING: France, Germany, the UK, Italy, the Netherlands, and Japan say they are ready to join efforts to ensure safe passage through the Strait of Hormuz.

The big energy risk was Iran causing extreme damage to neighboring country's infrastructure. This damage would be long term rather than a temporary (and likely over soon) blockade. Iran tried the attack but it pretty much failed to cause that serious of damage. The number of missiles launched was low, and the damage they caused is a lot less than I would have guessed a month ago. Unless there is follow through soon, I'm going to call it. That this conflict is over. That Iran is out of steam. Also, that Iran did this further alienates them from their neighbors.

There is also no historical "genocide" where the people being killed simply had to say, "Ok, we will live in peace." In fact, they were always saying that from the start and were being killed anyway. These people's government, Hamas - who they still support - make very clear their intentions the other way. A people are not obligated to live next to a violent barbarian tribe forever. Compeltely awful, toxic cultures/countries can and should fail entirely.

I'm a very strong believer in game theory. That to get your opponent to back down, you punch back 10 times as hard. We also cannot separate Hamas from Palestine. An honest/thorough interpretation of the numbers is that only ~35% of them want to coexist with Israel, even today now after everything. I do feel awful for that 35% of course.

These people are extremely racist and extremely genocidal.

@Olivekhan56 @Philestine786 @Hajd78077521 @DXBMediaOffice Or I guess this is just some divisive robot account... interesting.

@Philestine786 @Hajd78077521 @DXBMediaOffice And what have you achieved in life ? What is your success on this world apart from bashing Israel and USA.

Authorities in Dubai confirm the success of all air interception operations, with no injuries reported. Please rely on official sources for updates.