The Hashdex Nasdaq Crypto Index US ETF (NASDAQ: NCIQ) offers investors a unique opportunity to gain exposure to the cryptocurrency market through a traditional exchange-traded fund structure. Launched in February 2025, this fund tracks the Nasdaq Crypto US Settlement Price Index and provides a regulated avenue for investing in major digital assets. This guide explores its key features, performance metrics, and essential details for potential investors.
Understanding the NCIQ ETF
The NCIQ ETF is designed to mirror the performance of the Nasdaq Crypto US Settlement Price Index, which includes leading cryptocurrencies. It falls under the alternative currency category and is classified as a partnership for tax purposes. With assets under management exceeding $122 million, it represents a significant vehicle for crypto exposure within a conventional brokerage account.
This fund distinguishes itself through a focused holding strategy, primarily investing in Bitcoin and Ethereum. Its structure aims to reduce the complexities often associated with direct cryptocurrency ownership, such as security concerns and custody issues.
Key Performance and Statistics
Monitoring an ETF's performance metrics is crucial for informed investment decisions. The NCIQ ETF provides several key data points that reflect its market activity and financial health.
- Recent Trading Data: The fund's price has experienced fluctuations within a 52-week range of $18.97 to $28.55. Its average daily volume is approximately 24,541 shares.
- Expense Ratio: A major advantage of this ETF is its low net expense ratio of 0.25%, which is competitive compared to the average for cryptocurrency and currency ETFs.
- Market Capitalization: The fund currently has a market cap of around $1.10 million, with 40,000 shares outstanding.
These statistics help investors gauge the fund's liquidity, cost-efficiency, and overall market presence.
Fund Expenses and Fees
Cost is a critical factor in ETF investing. The NCIQ ETF is notably cost-effective, especially when compared to its peers.
Type | NCIQ | Cryptocurrency ETFs | All ETFs |
---|---|---|---|
Management Fee | 0.25% | 0.84% | 0.53% |
Total Expense | 0.25% | 0.88% | 0.73% |
Net Expense | 0.25% | 0.86% | 0.60% |
As the table illustrates, the NCIQ ETF's net expense ratio of 0.25% is significantly lower than the category averages. There are no fee waivers or other expenses, making its fee structure straightforward and transparent for investors. For those looking to explore more strategies on managing portfolio costs, understanding expense ratios is a fundamental step.
Portfolio Composition and Top Holdings
The NCIQ ETF employs a concentrated investment strategy, with its portfolio heavily weighted towards the two largest cryptocurrencies.
- Bitcoin (BTC): Constitutes approximately 87.86% of the fund's holdings.
- Ethereum (ETH): Makes up about 12.69% of the portfolio.
- US Dollars and Cash Equivalents: A very small portion (0.05%) is held in cash or cash-like instruments.
This focused approach means the fund's performance is closely tied to the price movements of Bitcoin and Ethereum. It offers pure exposure to these market leaders without the dilution of many smaller altcoins.
Fund Management and Operations
The operational backbone of the ETF ensures its smooth functioning and regulatory compliance.
- Advisor: Hashdex Asset Management Ltd. is responsible for the fund's management and investment strategy.
- Custodians: A multi-custodian model is used, including U.S. Bank, N.A., Coinbase Custody Trust Company LLC, and BitGo Trust Company, Inc., to safeguard the digital assets.
- Administrator and Transfer Agent: U.S. Bancorp Fund Services, LLC handles these critical back-office functions.
- Distributor: Paralel Distributors LLC is the fund's distributor.
This structure leverages established financial institutions to provide security and operational integrity, which is a key benefit for investors seeking regulated crypto exposure.
Frequently Asked Questions
What is the investment objective of the Hashdex Nasdaq Crypto Index US ETF (NCIQ)?
The NCIQ ETF aims to track the investment results of the Nasdaq Crypto US Settlement Price Index. This index measures the performance of a regulated, exchange-based market for cryptocurrency in the United States, providing investors with exposure to the crypto asset class.
How can I buy shares of the NCIQ ETF?
Shares of NCIQ can be purchased through any standard online brokerage account that offers access to the NASDAQ exchange. This includes popular platforms used by retail investors, making it easily accessible.
How does the NCIQ ETF's expense ratio compare to other similar funds?
The NCIQ ETF is very competitive, with a net expense ratio of 0.25%. This is substantially lower than the average for both cryptocurrency-focused ETFs (0.86%) and the broader ETF universe (0.60%), making it a cost-efficient option.
What are the primary risks associated with investing in the NCIQ ETF?
The primary risks are the high volatility inherent to cryptocurrency prices, concentration risk due to its heavy weighting in just two assets (Bitcoin and Ethereum), and the regulatory uncertainties that can affect the digital asset market.
Is the NCIQ ETF a good way to get exposure to Bitcoin and Ethereum?
Yes, for investors who prefer a traditional securities account and want to avoid the technical challenges of direct crypto ownership—like managing private keys and using digital wallets—the NCIQ ETF provides a convenient and regulated alternative.
Does the NCIQ ETF pay a dividend?
No, the fund does not currently pay a dividend. Its value is based solely on the appreciation (or depreciation) of its underlying cryptocurrency holdings. Investors seeking income should consider other investment products.
Conclusion
The Hashdex Nasdaq Crypto Index US ETF (NCIQ) presents a compelling option for investors aiming to diversify into cryptocurrencies through a familiar, exchange-traded product. Its low expense ratio, focused holdings on major assets, and robust operational structure managed by established firms make it a noteworthy fund in the alternative currency space. As with any investment, particularly in volatile asset classes, thorough research and consideration of personal risk tolerance are essential. For a deeper dive into the tools available for tracking such investments, you can view real-time tools that provide live data and analysis.