Two ETFs out this summer are working the overnight shift

Stocks bought at the market close and sold when markets open again in the morning often outperform based on research going back about 14 years

Lavine’s after-hours strategy places an emphasis large- and small-cap stocks. For expample, his firm’s NightShares 2000 ETF

He cites news flow as a key factor behind the “night effect.” It’s a time, he contends, when investors often feel the need to catch up

“People have this sort of desire to go home flat sometimes so they can sleep at night,” Lavine said

“Statistically, bear markets happen during the day session,” Lavine said. “It’s much more frequent.”

So far, the ETFs are underperforming the Russell 2000 and Dow since their inception on June 28

The NightShares 500 and NightShares 2000 ETFs are down 5.7% and 6.9%, respectively. Meanwhile, the Russell 2000 is off 3.6% and the Dow is off 2.6%.