State Street Global Advisors announced the launch of three new digital asset and “disruptive technology” exchange-traded funds (ETFs). The new ETFs will be managed by Galaxy Asset Management, a subsidiary of Mike Novogratz’s Galaxy Digital Holdings.
Introducing New ETFs
According to a statement by State Street, the new funds will be called the SPDR Galaxy Digital Asset Ecosystem ETF (DECO), SPDR Galaxy Hedged Digital Asset Ecosystem ETF (HECO), and SPDR Galaxy Transformative Technology Accelerators ETF (TEKX). DECO aims to provide exposure to companies that stand to benefit from the adoption of cryptocurrencies as well as the blockchain and digital asset industries.
Volatility Management
HECO has a similar purpose to DECO, but provides more management by using covered call options and protective put options to manage volatility. These ETFs aim to provide investors with safer access to the digital asset market.
Disruptive Technologies
TEKX aims to provide exposure to companies that support new disruptive technologies, including but not limited to blockchain and artificial intelligence (AI). Digital assets and blockchain technology have the potential to transform financial markets and the economy over the next decade, said Anna Paglia, chief business officer at State Street Global Advisors.
Paglia said some investors are uncomfortable with the short-term, volatile price movements of a single currency, and therefore they think the launch of actively managed digital asset portfolios that take advantage of diversification benefits is the next evolution of this market.
As of the end of 2023, State Street has $4.128 trillion in assets under management, $1.27 trillion of which is in ETFs.
The introduction of the new ETFs aims to provide investors with broader access to the digital asset market and to evaluate the various opportunities in this space. The proposed diversification and volatility management strategies are designed to appeal to a wider range of investors. This development highlights the potential impact of digital assets and disruptive technologies on financial markets.
Disclaimer: The information contained in this article does not contain investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
