How Does BITX, Volatility Shares 2X Leveraged Bitcoin Strategy Fund Work?


Instead, the Fund seeks to benefit from increases in the price of Bitcoin Futures Contracts for a single day. The market for the bitcoin futures contracts is still developing and may be subject to periods of illiquidity. The Fund seeks daily investment results, before fees and expenses, that correspond to twice the daily performance of the Index.

This historic performance strongly suggests that futures market makers can cost-effectively hedge their positions with Bitcoin. For single-day moves, BITX’s simulated best-case gain is 2X of the BTC move, as you would expect, but on the worst loss side, the simulated BITX only moved -47% compared to the 37% move of Bitcoin. The worst-case day was March, 12th, 2020, during the worst of the Covid crash. The CME’s bitcoin futures drop was less than the full BTC drop that day, probably because either the USA markets were closed when the drop happened, or the drop was very short-lived. Architecturally, BITX is structured as a 2X leveraged, daily resetting, exchange-traded fund. Volatility Shares, the issuer of BITX, seeks to have the ETF deliver twice the daily percentage moves of a mix of short-term CME Bitcoin futures.

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  1. Simulating BITX’s performance from that point forward is straightforward.
  2. While some futures do have those characteristics, in the five years that bitcoin futures have been trading, they’ve been quite predictable, mostly driven by mundane things like interest rates.
  3. Anka is specifically designed for DevOps, CI/CD, and Automation teams that need to build and test macOS or iOS applications.
  4. Perhaps this shortfall is due to lower volatility during the weekends.

The table above shows some of the benefits of BITX’s daily resetting ETF structure. For multi-day periods, BITX’s effective leverage is lower than 2X for down-trending periods, and better than 2X, sometimes dramatically, for up-trending periods. The reason for this is discussed in the next sections. Companies can ask for reviews via automatic invitations. Labeled Verified, they’re about genuine experiences.Learn more about other kinds of reviews. Volatility Shares, LLC is committed to protecting your privacy.

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The Fund presents different risks from other funds, may only be suitable for knowledgeable investors who understand the consequences of seeking daily (2x) investment results, including the impact of compounding on Fund performance. Investors in the Fund should actively manage and monitor their investments, as frequently as daily. An investor in the Fund could potentially lose the full value of their investment within a single day.

When first introduced in late 2017, there was speculation that Bitcoin futures would not closely track Bitcoin’s daily (spot) price, but Bitcoin futures have proved to be a good proxy for Bitcoin. This performance is not surprising given how futures really work. The popular notion of futures is that they are vehicles for wild speculation, subject to huge unpredictable swings. While some futures do have those characteristics, in the five years that bitcoin futures have been trading, they’ve been quite predictable, mostly driven by mundane things like interest rates.

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To date, the US Securities Exchange Commission (SEC) has rejected all the applications of proposed USA-based Exchange Traded Funds that directly hold Bitcoin. I will get into some details later in this post, but unlike some other futures types, the historical daily percentage moves of Bitcoin futures have closely tracked Bitcoin’s moves and this close correspondence is likely to continue. On June 27th, Volatility Shares introduced BITX, the first 2X leveraged Bitcoin Exchange Traded Fund. This post will review BITX’s architecture, operational characteristics, likely risks, possible rewards, and potential trading strategies. A simulation of BITX back to 2014 provides some data on how this Exchange Traded Fund (ETF) might perform in the future. People who write reviews have ownership to edit or delete them at any time, and they’ll be displayed as long as an account is active.

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Must say there’s also a lovely selection at breakfast time. As of the date of this prospectus, the Fund has no operating history and currently has fewer assets than larger funds. Important Information About the Fund
Past performance is not necessarily indicative of future results. Monday’s daily volatility is 11.6%, a bit higher than the 9% daily average, but well below the predicted 14.7%. Perhaps this shortfall is due to lower volatility during the weekends. Shares are not FDIC insured, may lose value, and have no bank guarantee.

We use your registration information to customize and deliver additional resources via email, including company and fund news. To learn more about how we handle your personal information, read our Privacy Policy. If you don’t want to receive email from us, simply uncheck the box at the bitx anka bottom of this form. The Fund may invest in reverse repurchase agreements. The S&P CME Bitcoin Futures Daily Roll Index is designed to measure the performance of the CME Bitcoin Futures market and is rebalanced on a daily basis between the front contract and the next month’s contract.

Leveraging a combination of custom and Apple hypervisor/virtualization technology, Anka offers enhanced performance and security. It provides a simple CLI for generating Anka macOS VMs as well as tools like Packer. You can then manage the VMs as Templates/Tags in the Anka Registry (part of the Anka Build Cloud) and push/pull to and from hosts in your macOS cluster. The chart below shows the results of the BITX simulation. The price per share is scaled such that the 26-Jun-2023 price aligns with BITX’s $15 inception price. Suggested companies are based on people’s browsing tendencies.

The Fund is actively managed and its performance reflects investment decisions that the Sub-Adviser and Adviser make for the Fund. Accompanying the Anka Virtualization package which runs on macOS hardware, we provide the Build Cloud Controller & Registry. Below are two of the most popular examples of how our customers set up Anka Virtualization with the Build Cloud.

The first leveraged bitcoin futures ETF is hitting the market as crypto gains new momentum

The value of an investment in the Fund could decline significantly and without warning, including to zero. You should be prepared to lose your entire investment within a single day. The Shares will change in value, and you could lose money by investing in the Fund. S&P Global has computed values for BITX’s tracking index, SPBTFDUE, starting from late 2017, when CME Bitcoin futures started trading.

DevOps teams implementing Anka can expect flexibility, allowing them to install onto existing infrastructure and automation – whether it’s cloud providers like AWS or on-premises! The Anka Virtualization package can be installed onto any macOS hosts. The Anka Build Cloud Controller & Registry can be ran as standalone binaries, a docker-compose package and also with our Build Cloud Controller & Registry Helm Chart for Kubernetes users.