New fund is one of the first ETF to provide liquid, scalable
means for adding Bitcoin exposure to a portfolio
Simplify Asset Management (“Simplify”), an innovative provider
of Exchange Traded Funds (“ETFs”), today announced the launch of
the Simplify U.S. Equity PLUS GBTC ETF (Nasdaq: SPBC).
SPBC 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). The portfolio is
periodically rebalanced, and the fund’s Adviser actively manages
the premium/discount dynamics of GBTC via either direct trading in
the market or via private placement. The fund retains the tax
efficiency that is a hallmark of the ETF space and does not provide
investors with a K-1 come tax time.*
“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.”
SPBC joins a fast-growing Simplify ETF lineup, which earlier
this month also saw the launch of the Simplify Interest Rate Hedge
ETF (NYSE Arca: PFIX) and the Simplify Volatility Premium ETF (NYSE
Arca: SVOL), two first-of-their-kind ETFs.
“Helping advisors and investors build better portfolios is at
the heart of our work at Simplify, and with PFIX, SVOL, and now
SPBC, we’re very excited about the approaches we’re bringing to
market as a means of helping solve some of the toughest investment
challenges,” added Kim.
“Nasdaq supports innovation throughout the financial universe,
and our exchange is home to the most innovative companies and the
most innovative ETFs,” said Giang Bui, Head of U.S. Exchange Trade
Products for Nasdaq. “Our work with Simplify helps investors
navigate the strong demand for cryptocurrency exposure and the
regulatory requirements needed to protect investors.”
ABOUT SIMPLIFY ASSET MANAGEMENT INC
Simplify Asset Management Inc. is a Registered Investment
Adviser founded in 2020 to help advisors tackle the most pressing
portfolio challenges with an innovative set of options-based
strategies. By accounting for real-world investor needs and market
behavior, along with the non-linear power of options, our
strategies allow for the tailored portfolio outcomes for which
clients are looking. For more information, visit
www.simplify.us.
Investors should carefully consider the investment
objectives, risks, charges and expenses of Exchange Traded Funds
(ETFs) before investing. To obtain an ETF's prospectus containing
this and other important information, please call (855) 772-8488,
or visit SimplifyETFs.com. Please read the prospectus carefully
before you invest.
An investment in the fund involves risk, including possible
loss of principal. Past performance does not guarantee future
results.
The Simplify U.S. Equity PLUS GBTC ETF seeks long-term capital
appreciation. The fund is new and has a limited operating
history.
Fund Risks:
The Fund invests in companies without restriction as to
capitalization. The earnings and prospects of small and
medium-sized companies are more volatile than larger companies.
Small and medium-sized companies normally have a lower-trading
volumes which may tend to make their market price fall more in
response to selling pressures and may have limited markets, product
lines, or financial resources and lack management experience.
The Fund invests directly in equity securities of U.S. companies
and also in exchange-traded futures contracts, Grayscale® Bitcoin
Trust, a wholly-owned subsidiary and other exchange-traded funds
and is therefore subject to the same risks as the underlying
securities. The cost of investing in the Fund will be higher
because you indirectly bear the expenses of the Subsidiary as well
as entails higher expenses than if invested into the underlying ETF
directly. The Subsidiary is a private fund not registered under the
Investment Company Act of 1940 and is not subject to all of the
investor protections of the 1940 Act, such as limits on leverage
when viewed in isolation from the Fund. Futures contracts involve
the risks of an imperfect correlation between the change in market
value of the instruments held by the Fund and the price of the
forward or futures contract; possible lack of a liquid secondary
market; leverage, which means a small percentage of assets in
futures can have a disproportionately large impact on the Fund and
losses are potentially unlimited.
Risks Specific to Bitcoin and Cryptocurrency:
Bitcoins, Cryptocurrencies and pricing on Bitcoin Exchanges
and other venues can be highly volatile.
The Fund will not invest “directly” in bitcoin, bitcoin futures,
or other cryptocurrencies. The Fund is not expected to track the
price movements of cryptocurrencies however the value of the Fund's
investment in the Grayscale® Bitcoin Trust is subject to
fluctuations in the value of bitcoins. The value of bitcoins is
determined by the supply of and demand for bitcoins in the global
market for the trading of bitcoins, which consists of transactions
on electronic bitcoin exchanges. The shares of the Grayscale
Bitcoin Trust may trade at a premium or discount, may not directly
correspond to the price of Bitcoin, and are highly volatile.
Currently, there is relatively small use of bitcoins in the
retail and commercial marketplace in comparison to the relatively
large use of bitcoins by speculators, thus contributing to price
volatility that could adversely affect the Fund's investment in the
Grayscale® Bitcoin Trust. Bitcoin transactions are irrevocable so
that stolen or incorrectly transferred bitcoins may be
irretrievable. As a result, any incorrectly executed bitcoin
transactions could adversely affect the value of the Fund's
investment in the Grayscale® Bitcoin Trust.
Cryptocurrencies operate without central authority or banks and
are not backed by any government. Cryptocurrencies may experience
very high volatility, and related investment vehicles that invest
in cryptocurrencies may be affected by such volatility.
Cryptocurrency is not legal tender. Federal, state or foreign
governments may restrict the use and exchange of cryptocurrency,
and regulation in the U.S. is still developing. Cryptocurrency
exchanges have been known to stop operating and have permanently
shut down due to fraud, technical glitches, hackers or malware.
Cryptocurrencies exchanges are new, largely unregulated, and may be
more exposed to fraud.
* In general, ETFs can be tax efficient. ETFs are subject
to capital gains tax and taxation of dividend income. However, ETFs
are structured in such a manner that taxes are minimized for the
holder of the ETF and because the capital gains tax is incurred by
the investor after the ETF is sold and is usually not exposed to
capital gains on any individual security in the underlying
portfolio. However, it is important to note that because the
Subsidiary is a controlled foreign corporation, any income received
by the Fund from its investments in the Subsidiary will be passed
through to the Fund as ordinary income, which may be taxed at less
favorable rates than capital gains. The Fund's investment in
Grayscale Bitcoin Trust or similar investment vehicle is a grantor
trust for U.S. federal income tax purposes, and therefore an
investment by the Fund in such an investment will generally be
treated as a direct investment in a cryptocurrency for such
purposes.
Simplify ETFs are distributed by Foreside Financial Services,
LLC.
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version on businesswire.com: https://www.businesswire.com/news/home/20210525005358/en/
MEDIA: Patrick Phalon MacMillan Communications (212)
473-4442 patrick@macmillancom.com
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