Dogecoin ETF Sees Strong Debut, But Rex-Osprey Is Already Plotting a Riskier DOJE Fund

Rex-Osprey’s DOJE, the primary U.S. spot Dogecoin ETF, produced strong trading volumes when it hit the market on Thursday, touchdown within the prime 5 for ETF rollouts thus far this 12 months. And its issuer has already filed for a riskier, leveraged play on it. 

In a filing registered with the SEC on Thursday, Rex-Osprey utilized to launch the REX DOJE Progress & Revenue ETF, an alternate traded product that goals to supply between 105-150% publicity to the value return of DOJE on a single day.

“As a result of the fund seeks every day leveraged funding outcomes, it is vitally completely different from most different exchange-traded funds,” the submitting reads. “In consequence, the fund could also be riskier than options that don’t use leverage.”

The REX DOJE Progress & Revenue ETF portfolio will likely be composed of three separate elements: leveraged lengthy publicity within the underlying Dogecoin ETF (DOJE), a lined name technique to generate revenue, and funding in short-term treasuries or cash market funds.

Its main goal is to pay weekly distributions, with a secondary goal of incomes every day funding outcomes between 1-1.5x the % change of DOJE. 

The leveraged funding submitting just isn’t new to Rex-Osprey, which gives quite a lot of leveraged ETF performs, providing larger publicity however extra danger for buyers. 

Its newest prospectus makes it well-known that this extra danger just isn’t for everybody. 

“The fund just isn’t appropriate for all buyers,” it reads. “The fund is designed to be utilized solely by educated buyers who perceive the potential penalties of in search of focused every day leveraged funding outcomes, perceive the dangers related to the usage of leverage, and are prepared to watch their portfolios steadily.”

Due to the every day leveraged make-up, the agency additionally notes that past a single day the fund will lose if DOJE’s return is flat, and it’s additionally doable the Progress & Revenue ETF will lose even when the DOJE ETF will increase over greater than a day. 

Moreover, the prospectus signifies that there isn’t any assure the technique will likely be applied correctly, or that will probably be in a position to pay weekly distributions.

Dogecoin (DOGE) is down 6% in the last 24 hours to $0.265. The main meme coin has jumped greater than 22% within the final month, however stays round 64% off its 2021 all-time excessive of $0.73.

Rex-Osprey’s normal DOJE ETF began trading on Thursday and generated about $17 million price of buying and selling quantity, placing it within the prime 5 for first-day quantity amongst ETF launches this 12 months, in accordance with Bloomberg Senior ETF Analyst Eric Balchunas.

The Rex-Osprey XRP ETF, in the meantime, additionally launched on Thursday and noticed a lot stronger demand, topping this 12 months’s listing of recent fund rollouts with almost $38 million in buying and selling quantity.