Behold a Golden Horse & Bitcoin Will Follow
Crypto, the latest and greatest craze. Yep, that's right. Crypto! Even your granny may be trading crypto. Although the Security Exchange Commission (SEC) was hesitant about the approval of a bitcoin spot exchange traded fund (ETF), a new asset allocation has arisen. Behold Bitcoin!
In 2004 the 1st gold ETF was released to the general investment public in the United States. State Street released the Street Track Gold ETF to track gold under the ticker GLD. The release of this ETF was the 1st time individuals were able to easily buy and sell gold in a regular brokerage account. Prior, individuals had to either open a commodity account or buy/sell gold coins at your local coin dealer with high transaction fees of 5-10% markup fees. Instead of all these steps, an individual was able to easily get exposure to gold from their existing brokerage account. Instead of calling your local coin store for gold spot prices and driving over to grab some ounces, an investor can click, click, click to get exposure to gold via a securitized asset of gold with minimal fees.
Buying gold coins have some pretty expensive fees compared to efficient assets that trade publicly on major exchanges such as the New York Stock Exchange (NYSE). Buying traditional gold coin bullion is a very over the counter market (OTC). OTC markets are very fragmented and difficult to discover what current prices are of the asset. Transparent pricing in the public markets creates efficiencies and easy price discovery.
The gold ETF has led the way for alternative assets such as gold but most importantly it has led the way for the present time of bitcoin being securitized so investors can get exposure to this new asset in their portfolio.
The new bitcoin ETF's trading on all the major exchanges is a positive to investors for getting exposure to this new asset class to a portfolio. Like gold, bitcoin will become an allocation in your portfolio to help achieve your investment goals. Contact our financial advisors today to review your portfolio.
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