Alternative Investments/Digital: Simplify Launches A New ETF For [80:20] Exposure To Stocks: Bitcoin

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Simplify Asset Management is an innovative issuer of ETFs.

Simplify announced last week the launch of the Simplify U.S. Equity PLUS GBTC ETF (NASDAQ: SPBC), an ETF that will invest at least 80% of its net assets in U.S. equity securities and expects to invest up to 15% of net assets in bitcoin via the Grayscale Bitcoin Trust (GBTC). (BusinessWire)

Simplify US Equity PLUS GBTC ETF

The new ETF seeks to provide an efficient way for asset allocators to add Bitcoin exposure to portfolios.

It provides operational simplicity for investors by actively managing the rebalancing of the bitcoin allocation as well as the premium/discount dynamics of GBTC.  The ETF wrapper provides attractive efficiencies including transparency, liquidity, tax efficiency, and no K-1’s.

The ETF charges a gross expense ratio of 0.50%.

Compelling non-correlation to equity and fixed income

“Cryptocurrency markets now exceed $2 trillion in value and account for more than 1% of the overall global market portfolio. In addition, recent research has shown how uncorrelated crypto assets are to equity and fixed income markets, making them a possibly compelling part of a well-diversified portfolio,” said Paul Kim, CEO with Simplify.

“But allocating to crypto-assets is difficult since over-the-counter offerings can present a host of challenges for investors and advisors, managing direct crypto exposure can be incredibly time consuming and onerous, and there remains no ETF on the market providing direct exposure to crypto itself. We’re very pleased to be launching SPBC, as a means of solving these challenges, providing a liquid, scalable way to add Bitcoin exposure to a portfolio,” Kim added.

GBTC

As of June 1, GBTC traded at a discount to NAV of 14.61%. This can be advantageous if purchases are made on the secondary market.

“That means we’re acquiring bitcoin via GBTC at a discount,” Simplify’s Kim told Financial Advisor. “If GBTC trades at a premium in the future, we can manage the entry and rebalancing both from tax and strategic targeting perspectives and also from the standpoint of the premium/discount.”

Related Story:  Grayscale Trains Its Sights On Morphing GBTC Into An ETF

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