Investment management company Invesco is launching a blockchain exchange-traded fund (ETF) on the London Stock Exchange today.
For the effort, Invesco has partnered with London-based Elwood Asset Management, an investment firm specializing in digital assets, to launch the product called the “Invesco Elwood Global Blockchain UCITS ETF.”
Elwood announced the news Monday, saying the ETF is designed to target companies with the potential to generate “real earnings” from blockchain technology.
Chris Mellor, head of EMEA (Europe, the Middle East and Africa) ETF equity product management at Invesco, said:
“The potential for blockchain to drive real earnings is huge, but it is often hidden within companies involved in other areas. This ETF offers investors access to companies with real earnings now, but with the added potential of blockchain-related earnings not reflected in their share prices.”
The ETF carries an annual management fee of 0.65 percent and aims to deliver the performance of the Elwood Blockchain Global Equity Index by “physically investing in the index constituents,” Elwood said in its statement.
The index, calculated for Elwood by German provider of financial indices Solactive AG, currently has a portfolio of 48 companies.
These include cryptocurrency chip-maker Taiwan Semiconductor Manufacturing Company (TSMC), bitcoin futures trading operator CME Group, South Korean messaging app giant Kakao, Japanese cryptocurrency exchange operator Monex Group, online retail giant Overstock, Signature Bank and Square.
The index’s sector allocations currently include information technology (46 percent), financials (23 percent), communication services (9 percent), and in materials and consumer discretionary sectors (8 percent), according to the announcement. The three largest geographical allocations are to the US (39 percent), Japan (29 percent) and Taiwan (12 percent).
Elwood CEO Bin Ren said: “We believe the potential for blockchain to change the global economy is greatly underappreciated in today’s market, much like the internet was in the beginning, when most people couldn’t see past its usefulness for email.”
Invesco image via Shutterstock