As Ámbito reportedArgentines can now operate the new range of Argentine Certificates of Deposit (Cedears) ETF. Between Thursday and this Friday they debuted the five new instruments linked to the evolution of Bitcoin (BTC), Ethereum (ETH), gold, the S&P 500 (short), and China.
As this media learned, at mid-afternoon this Friday the Short S&P 500 ETF (SPY) had already moved $126 million, the gold ETF (GLD) about $323 million and the Ethereum ETF $1.1 billion. This Friday they took to the field FXI (China) and that of Bitcoin (IBIT)which is expected to move more volume than its peers. At the time of writing this note, the IBIT had already operated $3.8 billion and the FXI $180 millions.
Paulino Seoane, head of investment ideas in Balanz Capital, explains in statements to Scope that the new Cedears represent a significant expansion of alternatives for local investors. The strategist analyzed each of the instruments, both their advantages and their risks.
And it is that the Bitcoin and Ethereum ETFs, which reflect the rise of cryptocurrencies in a context marked by global interest in this type of asset, arrive at a time when Bitcoin broke the $100,000 barrier last Thursday. However, for some market operators “it was too late and BYMA delayed it for a long time”, in clear reference to the rise that the cryptocurrency made before the arrival of the ETf in Buenos Aires.
Seoane points out that the two ETFs linked to cryptocurrencies are “similar, but with obvious differences.” ETHA (Ethereum) allows you to replicate the value of Ethereum (ETHA) without having to directly acquire the cryptocurrency and its ratio is 5:1. As the strategist explains, this instrument exposes the investor to cryptocurrencies through a regulated market, which mitigates the operational risk associated with managing wallets and private keys.
In addition, it enables diversification within a technological and digital asset portfolio, but warns: “We must consider the intrinsic volatility of the crypto market. Suitable for medium to high risk profiles“. The same happens with the IBIT, which has a ratio of 10:1. It is the ETF that has captured the greatest volume since it came out, “and locally it is the first formal interaction of the Argentine market with Bitcoin under a regulated scheme,” says Seoane. .
For the analyst, this is an opportunity for those who want exposure to the leading cryptocurrency “without the complications “direct possession techniques”. Although, like Ethereum, the Bitcoin market is very volatile, making it ideal for investors looking for disruptive assets.
It should be remembered that the ratio of a Cedear, for example that of Bitcoin, indicates how much amount of underlying bitcoin It is represented by a single paper issued in the Argentine market. For example, if the ratio is 100:1means that a Cedear represents 1/100 (0.01) of one BTC.
The new Cedears available in the Buenos Aires plaza
About him GLD (Physical Gold) The Balanz strategist indicates that it offers exposure to a traditional asset and a safe haven in times of economic uncertainty. In addition, it is an interesting alternative to local currencies or more volatile assets. And he adds: “We must consider that it has a lower relative risk, but with more moderate potential returns.” Its ratio is 50:1.
For its part, Short S&P 500 “It is an inverse ETF that follows the inverse daily performance of the Short S&P 500 index. “Its ratio is 8:1 and it is a key tool to protect portfolios in bear market scenarios.” For Seoane, this Cedear represents an opportunity for those investors who They seek to diversify their strategies with hedging instruments.
However, it warns that its performance depends on negative movements in the S&P 500 index. That is, it is useful in specific contexts of high uncertainty.
As for the FXI (China Index) The analyst explains that it is a Cedear that replicates an index composed of the 50 largest companies in China. Its ratio is 5:1. “As an advantage I consider it to be access to China’s economic growth through leading companies. In addition, it serves for geographical diversification, crucial for global portfolios,” he says.
However, he slips that the dependence on China’s political and economic stability, as well as international relations, must be considered.
The recommended strategy
Thus, for Seoane, the incorporation of new instruments brings Cedears’ total of ETFs available in the Buenos Aires market to 14 and expands the range of alternatives for local investors. “This not only allows greater access to different international markets, but also facilitates portfolio diversification,” he comments.
He adds that investors can now reduce risk by diversifying both geographically and by asset class, accessing cryptocurrencies, gold and diverse strategies. Furthermore, an important advantage lies in the tax treatment, since the profits obtained from the sale of CEDEARs are not subject to income tax, which increases its attractiveness.
Finally, he adds some recommendations for conservative investors, “GLD’s Cedear represents a solid option as a refuge against the volatility of local currencies or other assets. Those with moderate to aggressive profiles could consider FXI and SHwhich offer geographical and strategic coverage, while ETHA and IBIT are ideal for those who want to participate in the growth of the crypto marketor under a regulated framework”
“It is essential to maintain continuous monitoring of the evolution of these assets and global macroeconomic events that may influence their performance,” he concludes.
Source: Ambito
I am an author and journalist who has worked in the entertainment industry for over a decade. I currently work as a news editor at a major news website, and my focus is on covering the latest trends in entertainment. I also write occasional pieces for other outlets, and have authored two books about the entertainment industry.
