Nowadays digital assets, cryptocurrency, and metaverse are the words that are trending in the financial markets. Of course, the mutual fund industry also wants to join the party. Mutual fund houses will soon launch blockchain and metaverse schemes. Two fund houses – Navi Mutual Fund and Aditya Berla Sun Life Mutual Fund – have submitted drafts for such funds. Navi Metaverse ETF, Aditya Birla Sun Life Blockchain & Virtual Digital Assets ETFs are awaiting CB approval for the Fund of Fund launch.
Now that the rumors of a ban on cryptocurrencies are over, the industry is booming. Blockchain and Virtual Digital Assets focused on the global blockchain theme to invest in units of ETFs. The fund will be benchmarked against the MSCI ACWI IMI Blockchain Economy Index.
While, Navi Metaverse ETF FOF will be an open-end fund of funds scheme that invests in overseas ETF units. That provide exposure to companies that are in a position to enjoy the development of Metaverse.
Mutual fund advisers believe that these new schemes are up to date and could be a good way to diversify into new fields. Hence, whether these schemes currently play a significant role in the portfolios of retail investors is a question. That needs consideration at further, say advisers.
High Chances of Risk
“We are already living in a digital world and in the future, technology is moving forward. I am personally happy with the global IT and technology space. Although the future of Metaverse and Blockchain technologies looks bright. These are comparatively new technologies and their markets is not fully matured and explored. Babu Krishamurthy, Cheif Sherpa and FinSherpa’s financial advisers do not recommended to invest in pure Metaverse and blockchain technology companies. Because of their high risk chances.
Babu Krishamurthy, Cheif Sherpa and FinSherpa’s financial advisers believe that Metaverse and Blockchain are technologies of the future. That needs more regulations to balance the space. “You will see that investors make disproportionate profits in such technology. Therefore, some will look at these funds and some will waste them. The only thing investors need to keep in mind. That these are future tech funds and good options but also a lot of risk. So proceed with caution, “says Babu Krishnamurthy.
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