Key points of the News
- Innovation on display: Set to launch in September, STKD offers a novel approach for investors seeking combined exposure to Bitcoin and gold. It does this by leveraging existing futures contracts and ETFs tied to these assets, rather than owning them directly.
- Diversification and stability: The ETF combines Bitcoin, known as “digital gold” for its value retention potential, with traditional gold, a long-standing safe haven asset. This aims for diversification across historically uncorrelated assets.
- Leveraging existing ETFs: The STKD ETF leverages established financial instruments. This means that you will not directly hold Bitcoin, gold or other digital assets, but will instead use existing ETFs and futures contracts to provide exposure to their returns.
Quantify Chaos Advisors and Tidal Investments have collaborated to introduce a proposal for a new and innovative exchange-traded fund (ETFs) qIt connects Bitcoin and Gold. The STKD Bitcoin & Gold ETF is designed to offer investors a way to invest in both assets without the need for direct ownership.
The STKD ETF leverages a unique strategy, combining exposure to Bitcoin and gold through BTC futures and ETFs, as well as gold futures and ETFs. In doing so, offers investors a diversified approach to two distinct asset classes.
Bitcoin: digital gold and volatility
Bitcoin It has become known as “digital gold” over the years, gaining recognition as a store of value within the crypto community. Despite its higher returns compared to gold over the past decade, Bitcoin remains highly volatile. Investors seeking stability often turn to gold, which has a long history as a safe haven asset.
Quantify Chaos Advisors’ preliminary presentation highlights the complementary benefits of combining Bitcoin and Gold strategies. By combining assets with low correlation, the ETF aims to mitigate the impact of short-term market fluctuations. This approach could provide a more stable investment trajectory for investors.
How the Bitcoin and Gold ETF Works
The STKD ETF uses leverage to combine the total return of your Bitcoin strategy holdings with the total return of your Gold strategy holdings. It is important to mention that the ETF does not invest directly in Bitcoin, other digital assets or physical gold. Instead, seek exposure through futures contracts and ETFs.
Basically, every dollar invested in the fund provides approximately one dollar of exposure to Bitcoin and Gold strategies. The performance of the Gold strategy (less financial costs) adds to Bitcoin strategy performance (less financial costs).
Existing players
The SPDR Gold Trust (GLD) currently holds the title of largest gold ETF, with a market capitalization of $62 billion. Since the beginning of the year, it has returned a respectable 12.7%.
Meanwhile, the Bitcoin spot ETF made its debut earlier this year, with BlackRock’s IBIT leading the way. IBIT, with a market cap of $116 billion, has gained 8.2% so far this year, cementing its position as the industry leader.
Investors eagerly await the launch of the STKD Bitcoin & Gold ETF in September, anticipating the unique combination of these two valuable assets into a single investment vehicle.
