A new ETF on the Chi-X stock exchange is giving Australian investors a simple and secure way to invest in blockchain, crypto, and other fintech industries.
Exciting New Blockchain Asset Debuts on Chi-X Stock Exchange
As of October 14th, 2021, Australian traders are now able to invest in FTEC, an exciting new fintech and blockchain ETF on the Chi-X stock exchange. This gives investors a way to invest in blockchain technology and crypto without having to directly own cryptocurrencies or pick individual stocks.
The exchange-traded fund (ETF) allows investors to buy a share of the fund, which in turn owns shares of up to 75 different companies related to blockchain technology and crypto. In effect, it allows traders to invest in the blockchain industry without the risk of individual companies going under.
The ETF tracks a fintech and decentralized finance index from Indxx, a list of stocks and other assets intended to be representative of the fintech and blockchain industries overall. While many of these companies are blockchain-related, it also includes selections from other fintech applications.
FTEC joins 19 other ETFs available through Chi-X and is the first in the fintech and blockchain sectors. It’s the first passive ETF on the market there as well, meaning that it seeks to track a specific sector instead of implementing regular strategy changes like a managed fund.
Great Historical Performance From Constituent Stocks
The index that FTEC tracks was established in August 2021, and as such, does not have a substantial performance record at this time. However, some information is available through backtesting, where we look at what the performance of the current index stocks has been in the past.
Backtesting to June 2016, the index has increased in value 2.8 times over. This is often compared to the benchmark Indxx 500 Index, which is simply the 500 largest US securities. Over the same time frame, the benchmark index increased by 2 times over. The historical performance of the stocks chosen for the index has been exceptional, but it remains to be seen how much that will help Australian investors buying the ETF today.
FTEC currently holds stocks in 75 different companies spread across the fintech and DeFi sectors. Among these are digital payment companies, financial data providers, financial analysis firms, enterprise solutions, peer-to-peer lending, decentralized finance, tax software, and backend payment processing.
This broad swathe of the fintech space captures numerous advances that are expected to continue to provide exceptional growth into the future. The ETF gives investors exposure to companies on the cutting-edge of fintech without incurring the risk of betting on the wrong stock and incurring massive losses.
What FTEC Investors Are Buying Into
Over 60% of the stocks included in the ETF are based in the United States, with Canada, Britain, and the Netherlands following behind. The ETF invests in companies with both large-cap and mid-cap market capitalization, allowing for greater access to innovative stocks in their earlier growth stages.
Among the top holdings within the ETF are:
- Upstart Holdings Inc at 3.3% – Upstart is an innovative company providing any AI lending platform for use by banks and credit unions. They allow these institutions to focus on a broader selection of non-traditional variables in order to assess credit.
- Affirm Holdings Inc at 2.6% – Affirm is an American financial technology company that provides financing for consumer purchasers at the point of sale. Its wide use and partnership with major brands have led to rapid growth for the company.
- LendingClub Corp at 2.2% – LendingClub provides numerous financial products through its fintech platform. They enable peer-to-peer unsecured personal loans in the range of $1,000 to $40,000, with investors deriving interest from the loans.
- Nuvei Corp at 2.1% – Nuvei is a Canadian payment processor that provides an integrated payment platform for retailers of all kinds. The platform is compatible with hundreds of alternative payment methods and upwards of 150 currencies.
These are just four of the 75 companies that make up the ETF’s holdings, with others branching out into diverse areas of the fintech space. It’s worth pointing out that some trading platforms like “The News Spy” present themselves as legitimate ETF trading systems, but this could not be farther from the truth. A simple check on industry watchdog website ScamCryptoRobots.com explains why this is happening and why research is so important.
New Investment Opportunity Poised for Growth
Blockchain ETFs have taken off in popularity across the world, and Australian investors now have a chance to partake with FTEC. While it remains to be seen how this instrument will perform in the future, it could be just the investment Australian traders are looking for.