BITO Is Now A Good Way To Track Bitcoin

Mar. 07, 2022 3:26 PM ETProShares Bitcoin ETF (BITO)BTC-USD, BITO5 Comments

Summary

  • In the past, contango in Bitcoin futures meant that BITO was exposed to negative roll yield, making it unsuitable for long term holding.
  • As the market for Bitcoin futures have matured, this contango is beginning to fade. I examine why the lack of contango should persist.
  • Going forward, BITO would be a good way to track Bitcoin while there is still no spot Bitcoin ETF.
  • The liquid options on BITO gives investors opportunities to gain additional, regulated derivative exposure to Bitcoin.

bitcoin with circuit board,3d render

anita2020/iStock via Getty Images

The ProShares Bitcoin Strategy ETF (NYSEARCA:BITO) uses Bitcoin futures to gain exposure to the price movement of Bitcoin. While it has not been a viable way of tracking Bitcoin, recent market observations show that it will

This article was written by

Cogent investment views on digital assets, macro, and derivatives. BTC Maxi. My investment philosophy centers around deep fundamentals, impactful narratives, and Austrian economics. Time horizon is the primary dividing factor for investment research. Long-horizon research will focus on digital assets, macro, and general value opportunities. Emphasis is placed on a global, long-run macro view as the basis for these investment considerations. Short-horizon research will focus on options and volatility for income generation and hedging.Personally, I do business development and communications for a decentralized finance (DeFi) startup that brings capital efficient spot and derivatives trading to crypto. I have a few years of investing experience, a strong finance and economics background, and working proficiency in Python programming.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

About BITO ETF

SymbolLast Price% Chg
Expense Ratio
Div Frequency
Div Rate
Yield
Assets (AUM)
Compare to Peers

More on BITO

Related Stocks

SymbolLast Price% Chg
BITO
--