As a seasoned crypto investor with a knack for navigating market volatility and a keen eye for emerging trends, I find the launch of STKD’s BTGD ETF intriguing. The strategy to offer leveraged exposure to Bitcoin and gold seems like a smart move amidst the escalating geopolitical tensions and uncertainty surrounding the upcoming U.S. elections.
Investment firm Stacked (STKD) recently introduced a new Exchange-Traded Fund (ETF), highlighting amplified access to Bitcoin (BTC) and gold, as investors seem to favor the “dilution strategy” in anticipation of the U.S. presidential elections in November. This paraphrase keeps the original meaning but presents it in a more conversational tone.
In my analysis, as per the October 16th declaration, the STKD Bitcoin & Gold ETF (BTGD) is designed to provide investors with an opportunity to invest in two assets – Bitcoin and Gold. These assets are considered scarcities, and their investment could potentially safeguard against future inflation and currency devaluation due to debasement.
This actively managed ETF aims to provide equal parts ($1 each) investment exposure to Bitcoin (BTC) and a gold portfolio, for every dollar invested in the fund. The strategy involves owning a blend of ETFs and future contracts linked to the value of both BTC and gold.
Futures contracts are standardized agreements to buy or sell an underlying asset at a future date.
In light of escalating international conflicts, investors appear to be shifting their focus towards Bitcoin (BTC) and gold, as suggested in a report published on October 3rd by JPMorgan, indicating that they are preparing for potential disastrous events.
In light of increasing international conflicts and the upcoming U.S. election, experts predict that these factors could boost the ‘debasement trade,’ making investments in gold and Bitcoin more advantageous, as suggested in a recent report from JPMorgan.
The term “debasement trade” refers to an increase in gold demand due to various factors such as heightened geopolitical unrest since 2022, ongoing doubts about the future inflation scenario, and worries about large budget deficits in leading economies, according to JPMorgan.
STKD further explained the strategy:
“[O]ne of the more heavily debated narratives has been that of ‘bitcoin vs. gold’… but a discussion built on ‘versus’ misses the larger role that both assets can play for those investors looking for a mix of capital appreciation and portfolio hedging.”
STKD’s product debut occurs at a time when there is an increasing number of suggested ETFs that invest in cryptocurrencies before the U.S. presidential election in November.
In October, it was announced that asset manager Canary Capital is planning to debut Exchange-Traded Funds (ETFs) containing XRP and Litecoin (LTC), while Bitwise has also indicated intentions to introduce an XRP ETF.
This week, leveraged MicroStrategy ETFs surpassed $400 million in net assets as retail investors flock towards Bitcoin investments with high volatility, according to Bloomberg Intelligence data. Keep in mind that these leveraged ETFs come with extra risk and often underperform due to the expenses associated with daily rebalancing to maintain their leverage ratio.
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2024-10-16 18:51