The Token Fund is a cryptocurrency mutual fund where investors who do not know too much about the inner workings of the cryptocurrency markets can invest in many different digital assets all at once. Now there is obviously risk involved with every kind of investment, but for the same reasons that many traditional investors look to hedge and mutual funds, cryptocurrency investors may look to invest in digital mutual funds like The Token Fund.
TKN – Token Fund Tokens as shares
One of the most attractive things about the Token Fund is the way they prove stake. Users and investors purchase into the fund itself by holding TKNs, or shares of the overall fund itself.
It can be an arduous task to be invested in multiple cryptocurrencies at once. This means the holding of multiple wallets and clients, keeping many different private keys safe and sound, and trading between different assets by oneself. What if one exchange supports one portion of a digital asset portfolio, but not another portion. This would inherently drive down the liquidity of an investor’s portfolio. Having to switch between various exchanges just to keep trade part of your portfolio could cost the trader time, and ultimately, money.
By being able to purchase stakes of the overall fund, an investor can have access to the entire array of the Fund’s portfolio. Currently about half of it is in ETH and XBT, but has significant holdings in Euros and TetherUSD. Currently the price of on TKN is 34.99 USD, which is up almost 250% from the time of the Fund’s launch.
Another nice part about having shares of the Fund is the access to trading experience of the portfolio managers. When the investors are making money, so are they, so it behooves them to trade well and wisely for their stakeholders.
Not every investor -especially those new to cryptocurrency- will predict well what trading Monero against Bitcoin, or what Ethereum Classic to ETH will do to a portfolio, but that is precisely why mutual funds like this exist. To try and maximize overall Fund worth while trying to keep investor funds safe. They seek out opportunity, but diversify to mitigate risk. What a mutual fund is essentially, is access to assets and experience that regular investors may not be privy to by themselves.
The Fund itself is worth about $1.7 Million, so each TKN -worth ~$36 at the time of writing this- is a representative share of that $1.8 Million spread across the various digital assets. If the value of the portfolio grows, then so too does the current shares of the portfolio. Stakeholders can cash out -via XBT or ETH- at may time as well, so if they feel they are in a good place to, they can.
Disclaimer: This is a sponsored article and does not necessarily reflect the views or opinions of any The Merkle employees. This is not investment or trading advice. The only trading advice I will ever give is never invest more than you are able/willing to lose.