British Virgin Islands-based IDEG Asset Management (IDEG) will offer an Ethereum Enhanced Portfolio, an actively managed fund tracking the price of ether (ETH) using a futures arbitrage strategy to enhance returns and flatten volatility.
The fund will be part of the new TIMES suite of products, short for Trust, Interest, Mining, Yield Earnings and Structured Solutions.
“The Ethereum Enhanced Portfolio is our first of such products, providing qualifying investors an opportunity to capitalize on Ethereum, the most renowned smart-contract platform, while enhancing risk-adjusted returns compared to holding Ethereum,” said Emma Hu, product partner of IDEG, in a statement.
The company didn’t disclose the size or how much has been already invested in the fund.
Coinbase Prime will be the fund’s prime broker and custodian, building on a relationship that started in 2019, said IDEG Chief Compliance Officer and COO Suen Son Poon.
This Ethereum fund is launching as digital asset vehicles aside from bitcoin (BTC) have been gaining traction among institutional investors thanks to offering further diversification within the volatile digital asset sector. Most recently, Goldman Sachs (GS) began offering interested clients access to an ether fund issued by Galaxy Digital.
Last week bitcoin-related products took the lion’s share of fund outflows with $131.8 million of redemptions, while funds focused on ether saw just $15.3 million in outflows, according to a CoinShares report.
The Ethereum Enhanced Portfolio fund will be available to qualified investors globally, except for the United States, with a minimum investment amount of $100,000, according to company spokesman Ian Stirling. “The majority of single-coin tracker funds on the market tend to be passive funds,” he added, noting that the fund will charge a fixed management fee based on the asset under management.
IDEG is also planning to launch additional thematic funds in 2022, with actively managed multi-coin, decentralized finance (DeFi) yield farming and GameFi/metaverse play-to-earn (P2E) strategies being piloted in-house.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.