The Purpose Bitcoin Yield ETF employs a derivatives-based covered call strategy to pay monthly yield to investors.
- A bitcoin ETF offering monthly yields has been listed in Canada today.
- The Purpose Bitcoin Yield ETF is live on the Toronto Stock Exchange under the ticker symbol BTCY.B.
- Purpose Investments employs a derivatives-based covered call strategy to pay investors an expected eight to ten percent annual yield.
Canadian investors can now receive a monthly bitcoin yield through a new exchange-traded fund (ETF) listed on the Toronto Stock Exchange (TSX), reported Yahoo Finance. The Purpose Bitcoin Yield ETF employs a derivatives-based covered call strategy to pay investors a monthly yield.
The fund was created by Purpose Investments, the asset manager that launched the first bitcoin exchange-traded fund (ETF) in North America. The pioneering product launched in February broke records in its opening week after trading $80 million worth of shares within the first hour and $200 million on its first day.
The firm’s new bitcoin yield offering began trading today on the TSX under the ticker symbol BTCY.B with a management fee of 1.10%.
Purpose Investments said it couldn’t guarantee the yield paid out per month because of volatility, but it expects an annual yield of between eight and ten percent, per the report. The yield is classified as income in registered accounts.
When asked to what kind of investor the fund would appeal, chief operating officer and head of product at Purpose Investments, Vlad Tasevski, told Yahoo Finance that investors should consider the ETF “if they want to earn yield while they hold them” as it allows the generation of “additional short-term income on an asset they believe has long-term potential.”
“Given the connection between the volatility of the underlying asset and premiums, covered call strategies on cryptocurrencies offer unique exposure to a unique asset class, providing investors a high yield without sacrificing significant price participation,” Tasevski added.