The Case for Regulatory Tailwinds Over Traditional Fiscal Stimulus — FMKT as a Structural Play
Key Highlights
Policymakers are increasingly relying on deregulation rather than fiscal stimulus to support growth
Supreme Court and executive actions have meaningfully altered the regulatory environment
Deregulation acts as a supply-side catalyst without the inflationary risks of spending
Financials, energy, healthcare, and infrastructure may benefit disproportionately
The Free Markets ETF (FMKT) is designed to capture these regulatory tailwinds structurally
Deregulation as a Modern Growth Engine
For much of modern economic history, stimulus followed a familiar pattern. When growth slowed, Washington responded with spending programs, tax relief, or emergency measures designed to boost demand. These tools were highly visible and often effective in the short run, but they carried long-term costs in the form of rising deficits, heavier debt burdens, and renewed inflation pressures.
As markets move deeper into the mid-2020s, that playbook is quietly changing. Rather than injecting new money into the system, policymakers are increasingly turning to deregulation as a means of supporting growth. This approach works not by stimulating consumption, but by removing barriers to production, investment, and innovation.
A clear example emerged in late 2025, when U.S. officials reversed prior restrictions on oil and gas drilling in Alaska. By easing limits on the Trans-Alaska Pipeline System and reopening federal lands to exploration, regulators sought to expand domestic energy production without authorizing new federal spending.¹ The policy rationale was straightforward: unlock supply rather than boost demand.²
This shift reflects broader macroeconomic realities. With inflation having cooled from earlier highs but still a concern, traditional stimulus carries the risk of reigniting price pressures. Deregulation, by contrast, is viewed as a non-inflationary lever. It aims to free up capacity, reduce delays, and lower compliance costs, allowing private capital to do more of the work.
The scale of regulation helps explain why this matters. Estimates suggest that federal regulatory compliance costs U.S. businesses more than two trillion dollars annually.³ That burden functions much like an invisible tax, diverting resources away from hiring, investment, and innovation. Even modest relief can therefore translate into meaningful improvements in profitability, particularly in sectors where regulatory intensity is highest.
A Legal and Policy Reset
The current deregulatory momentum did not arise by chance. A pivotal moment came in June 2024, when the U.S. Supreme Court overturned the Chevron doctrine, a long-standing precedent that granted federal agencies broad discretion in interpreting ambiguous statutes.⁴ By eliminating automatic judicial deference, the Court fundamentally altered the balance of power between regulators and the judiciary.
The implications are significant. New regulations now face greater scrutiny, while existing rules are more vulnerable to legal challenge. This judicial shift was soon reinforced by executive action. In early 2025, the administration issued an order requiring agencies to eliminate multiple existing regulations for every new rule proposed.⁵ What initially sounded symbolic became operational policy, as agencies slowed rulemaking and began reviewing long-standing requirements across energy, finance, labor, and infrastructure.
The motivation behind this push has been as much economic as political. With public debt elevated and monetary policy less flexible, deregulation offers a way to support growth without expanding deficits or fueling inflation.⁶ Instead of government spending acting as the primary catalyst, the private sector becomes the engine once regulatory friction is reduced.
Certain industries stand out as likely beneficiaries. Financial institutions, particularly smaller and regional banks, have long argued that compliance costs disproportionately affect their ability to lend and compete. Energy producers face permitting processes that can delay projects for years. Healthcare and biotechnology firms navigate complex approval pathways that influence both innovation timelines and capital allocation. In each case, regulatory relief can materially improve efficiency and strategic flexibility.
This environment has reshaped how investors think about policy risk. Rather than viewing regulation solely as a headwind, markets are increasingly recognizing deregulation as a potential source of structural upside.
FMKT and the Structural Investment Thesis
Translating regulatory change into portfolio exposure is not straightforward. Deregulation does not benefit all companies equally, nor does it unfold uniformly across sectors. Attempting to identify individual winners requires constant monitoring of legal rulings, agency actions, and political developments.
The Free Markets ETF (FMKT) was launched in 2025 to address this challenge. The fund is designed to provide diversified exposure to U.S. companies we believe are positioned to benefit from a freer regulatory environment.⁷ Instead of focusing on a single industry, FMKT allocates across sectors where regulatory burdens have historically constrained profitability, including financials, energy, healthcare, infrastructure, and select areas of technology.
The underlying thesis is simple. When regulatory costs decline or uncertainty diminishes, companies gain operational leverage. Capital that would otherwise be devoted to compliance can be redirected toward expansion, innovation, or balance-sheet strength. In some cases, the removal of regulatory friction can unlock projects that were previously uneconomic.
FMKT’s approach reflects this logic. The fund employs a systematic framework to identify companies with high sensitivity to regulatory change, emphasizing businesses where policy shifts could meaningfully affect margins or growth prospects.⁸ By packaging these exposures into a single vehicle, FMKT allows investors to express a macro view without relying on individual stock selection.
Crucially, this is framed as a structural rather than tactical strategy. Deregulatory cycles in U.S. history have tended to persist over multiple years, often reinforced by legal precedents and institutional inertia. The rollback of Chevron deference represents a lasting constraint on agency authority that is unlikely to reverse quickly.⁹
That does not eliminate risk. Regulatory policy remains cyclical, and periods of liberalization have historically been followed by renewed oversight, often in response to excesses or crises. Reduced regulation can also encourage risk-taking, underscoring the importance of diversification and ongoing evaluation.
Still, the broader implication is clear. As fiscal stimulus becomes more constrained and monetary policy less accommodative, deregulation has emerged as a central policy lever. For investors seeking exposure to this shift, FMKT offers a way to align portfolios with an environment that emphasizes free markets, supply-side growth, and reduced governmental friction.
While headlines often focus on spending debates and interest-rate decisions, the quieter evolution of the regulatory framework may prove just as consequential. By lowering barriers rather than raising demand, deregulation reshapes the landscape in which companies operate. For those paying attention, the opportunity lies not in predicting every policy headline, but in recognizing when the rulebook itself is being rewritten.
Footnotes
Nichola Groom, “Trump Administration Revokes Biden-Era Limits on Alaska Oil Drilling,” Reuters, November 14, 2025.
Nichola Groom, “Trump Administration Revokes Biden-Era Limits on Alaska Oil Drilling,” Reuters, November 13, 2025.
“Free Markets ETF (FMKT),” fund background materials, 2025.
Loper Bright Enterprises v. Raimondo, 603 U.S. ___ (2024), decided June 28, 2024.
Executive Order 14192, “Unleashing Prosperity Through Deregulation,” January 31, 2025.
“If Trump Wins, He Plans to Free Wall Street from ‘Burdensome Regulations,’” Reuters, April 12, 2024.
“Free Markets ETF (FMKT),” fund overview and investment objective, 2025.
Michael A. Gayed, “Deregulation Is the New Stimulus — And This ETF Is First In Line,” Benzinga, August 5, 2025.
“$FMKT: Why Investors Should Treat Deregulation as a Structural Trend, Not a Fad,” The Lead-Lag Report, January 2026.
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Holdings are subject to change.
Deregulation Strategy Risks.The Fund’s strategy of investing in companies that may benefit from deregulatory measures entails significant risks, including those stemming from the unpredictable nature of regulatory trends. Deregulation is influenced by political, economic, and social factors, which can shift rapidly and in unforeseen directions. Changes in government priorities, political leadership, or public sentiment may result in the reversal of existing deregulatory policies or the introduction of new regulations that could adversely affect certain industries or companies. Further, while the Fund invests in companies expected to benefit from deregulatory initiatives, not all of these companies may achieve the expected advantages, whether fully, partially, or at all. The actual impact of deregulatory measures may vary widely depending on a company’s specific operational, financial, and competitive circumstances. Companies may also face challenges adapting to new regulatory environments, or their competitive positioning may be undermined by other market factors unrelated to deregulation. These risks could negatively affect the performance of the Fund’s portfolio.
Underlying Digital Assets ETP Risks. The Fund’s investment strategy, involving indirect exposure to Bitcoin, Ether, or any other Digital Assets through one or more Underlying ETPs, is subject to the risks associated with these Digital Assets and their markets. These risks include market volatility, regulatory changes, technological uncertainties, and potential financial losses. As with all investments, there is no assurance of profit, and investors should be cognizant of these specific risks associated with digital asset markets.
● Underlying Bitcoin and Ether ETP Risks: Investing in an Underlying ETP that focuses on Bitcoin, Ether, and/or other Digital Assets, either through direct holdings or indirectly via derivatives like futures contracts, carries significant risks. These include high market volatility influenced by technological advancements, regulatory changes, and broader economic factors. For derivatives, liquidity risks and counterparty risks are substantial. Managing futures contracts tied to either asset may affect an Underlying ETP’s performance. Each Underlying ETP, and consequently the Fund, depends on blockchain technologies that present unique technological and cybersecurity risks, along with custodial challenges in securely storing digital assets. The evolving regulatory landscape further complicates compliance and valuation efforts. Additionally, risks related to market concentration, network issues, and operational complexities in managing Digital Assets can lead to losses. For Ether specifically, risks associated with its transition to a proof-of-stake consensus mechanism, including network upgrades and validator centralization, may add additional uncertainties.
●Bitcoin and Ether Investment Risk: The Fund’s indirect investments in Bitcoin and Ether through holdings in one or more Underlying ETPs expose it to the unique risks of these digital assets. Bitcoin’s price is highly volatile, driven by fluctuating network adoption, acceptance levels, and usage trends. Ether faces similar volatility, compounded by its reliance on decentralized applications (dApps) and smart contract usage, which are subject to innovation cycles and adoption rates. Neither asset operates as legal tender or within central authority systems, exposing them to potential government restrictions. Regulatory actions in various jurisdictions could negatively impact their market values. Both Bitcoin and Ether are susceptible to fraud, theft, market manipulation, and security breaches at trading platforms. Large holders of these assets (”whales”) can influence their prices significantly. Forks in the blockchain networks—such as Ethereum’s earlier split into Ether Classic—can affect demand and performance. Both assets’ prices can be influenced by speculative trading, unrelated to fundamental utility or adoption.
● Digital Assets Risk: Digital Assets like Bitcoin and Ether, designed as mediums of exchange or for utility purposes, are an emerging asset class. Operating independently of any central authority or government backing, they face extreme price volatility and regulatory scrutiny. Trading platforms for Digital Assets remain largely unregulated and prone to fraud and operational failures compared to traditional exchanges. Platform shutdowns, whether due to fraud, technical issues, or security breaches, can significantly impact prices and market stability.
● Digital Asset Markets Risk: The Digital Asset market, particularly for Bitcoin and Ether, has experienced considerable volatility, leading to market disruptions and erosion of confidence among participants. Negative publicity surrounding these disruptions could adversely affect the Fund’s reputation and share trading prices. Ongoing market turbulence could significantly impact the Fund’s value.
● Blockchain Technology Risk: Blockchain technology underpins Bitcoin, Ether, and other digital assets, yet it remains a relatively new and largely untested innovation. Competing platforms, changes in adoption rates, and technological advancements in blockchain infrastructure can affect their functionality and relevance. For Ether, the dependence on its proof-of-stake mechanism and smart contract capabilities introduces risks tied to network performance and scalability. Investments in blockchain-dependent companies or vehicles may experience market volatility and lower trading volumes. Furthermore, regulatory changes, cybersecurity incidents, and intellectual property disputes could undermine the adoption and stability of blockchain technologies.
Recent Market Events Risk. U.S. and international markets have experienced and may continue to experience significant periods of volatility in recent years and months due to a number of economic, political and global macro factors including uncertainty regarding inflation and central banks’ interest rate changes, the possibility of a national or global recession, trade tensions and tariffs, political events, war and geopolitical conflict. These developments, as well as other events, could result in further market volatility and negatively affect financial asset prices, the liquidity of certain securities and the normal operations of securities exchanges and other markets, despite government efforts to address market disruptions.
New Fund Risk. The Fund is a recently organized management investment company with no operating history. As a result, prospective investors do not have a track record or history on which to base their investment decisions.
. Lead-Lag Publishing, LLC is not an affiliate of Tidal/Toroso, Tactical Rotation Management, LLC, SYKON Asset Management, Point Bridge Capital, or ACA/Foreside.