An ETF with positioning in Bitcoin and Ethereum is now trading on the Toronto Stock Exchange.
CI Global Asset Management on Tuesday launched the CI Galaxy Multi-Crypto ETF, which offers exposure to the two largest cryptocurrencies through the firm’s existing Bitcoin and Ethereum ETFs.
The fund seeks to reduce the price volatility associated with cryptocurrencies by managing allocations between the cryptocurrencies and cash, a release said. New York-based sub-advisor Galaxy Digital Asset Management uses a proprietary momentum-driven trading model to make allocation decisions, with the goal of better risk-adjusted returns than a buy-and-hold investment.
In adverse market conditions, declines in Bitcoin and Ethereum could result in the ETF “investing all or substantially all of its assets in cash,” the fund prospectus stated.
As of Jan. 31 the breakdown was 53% in the CI Galaxy Bitcoin ETF (US$ Series) and 47% in the CI Galaxy Ethereum ETF.
“As the crypto markets continue to mature, investors are increasingly seeking more sophisticated products that offer both diversification and volatility-reducing features,” stated Steve Kurz, global head of asset management at Galaxy Digital, in the release.
The ETF is aimed at clients who can tolerate high risk and want both capital growth over the long term and exposure to digital assets. The fund’s risk rating is high and the management fee is 0.5%. CI said it would cap the ETF’s management expense ratio at 1.05%.
Investors can buy Canadian dollar-denominated unhedged units under the ticker symbol CMCX.B and U.S. dollar-denominated unhedged units under CMCX.U.
“The fund provides the benefits of cryptocurrency investing — portfolio diversification, low correlation to other asset classes and high growth potential — with a systematic approach designed to mitigate price volatility,” said Kurt MacAlpine, CEO of CI Financial Corp., in the release.