The latest crypto ETF has entered the market | Kanish Chugh

Maddy: [00:00:20] Hello and welcome to you're in good company. The podcast makes investing accessible for everyone. I'm Maddy and as always, I'm in some very good company with my co-host, Sophie. 

Sophie: [00:00:30] Hi, Mads. We've both got matching drinks tonight. It's pretty cute this year. Ching Ching would have read Shiraz Gin where we're combining my love of Shiraz. And your love of gin. 

Maddy: [00:00:44] Love. It cannot complain, that's for sure. And we are celebrating because Fin Fest tickets are officially on sale. 

Sophie: [00:00:52] Fin Fest, powered by our friends at stake, is taking place in Sydney on the 15th of October, which seems like far away, but I feel like it's going to come around really quickly. 

Maddy: [00:01:01] So we are going to be challenging the perception that fine arts events are boring, although hopefully if you are listening to this you don't really think that. But across multiple stages, with over 25 plus educational sessions, some of the best investors and business leaders and entrepreneurs from around Australia. We've got bars, entertainment, food, Fin Fest really will leave you feeling very inspired and ready to take that next step on your investing journey. I sold. 

Sophie: [00:01:31] Not to mention the wagon. And they like this, I hope. I mean, first release tickets are $47 and spots are definitely limited. So no matter where you are on your investing journey, if invest will have you covered with all sorts of tailored sessions, so head to Equity Mates dot com slash fin fest to grab your tickets now and we will see you there. 

Maddy: [00:01:52] I cannot wait. And one thing that I'm going to be definitely keep my eye out for at Fin Fest is crypto. So today we are very excited to be speaking with Kanish Chugh from ETF Securities about a new way to invest in crypto. EBTC and EETH Australia's first spot, Bitcoin and Ethereum ETFs giving you direct ownership of the underlying cryptocurrencies themselves without the need to worry about crypto wallets and security. Here to break down everything that we need to know is. Kanish Welcome 

Kanish Chugh: [00:02:24] Thank you for having me. 

Sophie: [00:02:26] Kanish We always start the same way by asking our guest what is the best thing that's happened to you in the past week?

Kanish Chugh: [00:02:32] So this is a bit more of a personal sort of, I guess, piece of piece of excitement. But I coached my son's on the soccer team. He's only he's not even five yet. So he's he's quite young for the team. So just seeing him sort of, you know, develop and, you know, start to at least, you know, no, not pick up the ball. You know, I remember his I think it was his first game when actually I was I was coaching on the sidelines and I told him to look up and that was more to look at where the ball was. And he looked up at the sky and just sort of walking around. And so now he's actually sort of he's now actually playing and he's now actually, you know, knowing what to do. And yeah, so that that's been pretty exciting for mine because I'm actually coaching as well. So he enjoys it as well.

Maddy: [00:03:11] So we love to see the progress and. Kanish If you could have dinner with anyone, who would it be and why? 

Kanish Chugh: [00:03:18] This is it's this is a tough one, actually, because, you know, I think given I'm in finance, I'm in asset management and ETF. So it probably would be a lot of people may assume that I'd go look maybe in like a Warren Buffet or, you know, the standard sort of investor type or even like a Bill Gates, maybe. But again, it's I'm probably going to run with a bit of a personal theme. It's actually going to be my both my granddads. So both have since passed one passed last year and covered and one passed over 20 years ago. So probably be to actually have dinner with them and and sort of just talk to them again because it's been you know, there's a lot that's happened in my life that I'd like to, you know, talk to them about and actually remember a lot of the things that they have gone through. So they were both part of India when the partition happened between India and Pakistan and things like that, and some really interesting stories that they've told me. And it's like, I wish I remembered every bit, every bit of detail that you recorded it. So yeah, that's probably one there. 

Sophie: [00:04:17] It's like you don't appreciate it that much until you're much older and really understand the impact of it all yet. 

Kanish Chugh: [00:04:23] Pretty much, I think. 

Sophie: [00:04:24] Yeah. And if you could be a stock or company or who would you be and why. 

Kanish Chugh: [00:04:28] No surprises. But I went in with an ETF. Given it for where? For an ETF provider. I decided to you know, again, I went with AC DC so ac DC is how battery tech and lithium ETF and it it's an issue on for me because obviously it hits close to home in terms of trying to I guess innovate look at technology and how do we become better in terms of taking care of the planet and the environment. So that's something that that's close to home. I also am a bit of a connoisseur. So I love the idea of the electric vehicles and seeing how that is transforming. And so for me it is AC DC because it's you've got within that it's obviously diversified. So it's not one single stock, you know, there's no point in being a single story, might as well be a basket. So for me, for me it was AC DC.

Maddy: [00:05:17] I feel like a true ETF provider. 

Kanish Chugh: [00:05:20] Exactly right. 

Sophie: [00:05:21] When Maddy and I were super bored during I think it was one of the lockdowns in Melbourne in a seven day lockdown in Melbourne, we decided to do an ATF pitch night and I think our first pitch was actually AC DC. And watching it back, it's like somewhat embarrassing, but also like, why didn't we like invest more money in that, you know? 

Maddy: [00:05:37] I know I did very well over COVID. 

Kanish Chugh: [00:05:39] It's one of those ones. It's like when we when we launch a fund as well. And I've taken a personal investment in quite a number of our funds, but it's like some of them. I'm like, Why didn't I? Why didn't I go earlier with some of these and especially with AC DC? I remember launching it in 2017 and for about for about two years, that fund didn't attract much inflows. It was sort of sitting at about 20 or 30 million for about two years. And that in some context, it's it's, you know, it was like, okay, well, is this a megatrend that people want to invest in? And basically, it all changed in about 2019, back half of 2019, when sort of Biden came out in the election campaigning and talked about how he wanted to build some, you know, electrification programmes, etc.. And all of a sudden things started to shift and governments started to support it. And we saw performance turn around, we saw investments turn around and it just went went I think a lot of people started to really consider it then. So yeah, again, one of the things always hindsight's 2020. 

Maddy: [00:06:44] I was going to say, I think in investing almost more than anything else, hindsight is a beautiful thing, the amount of times I look back. But can we have you on today to discuss two new ETFs, crypto ETFs to hit the Sabre? And we are going to go into that in just a minute. But we do find everyone has a different explanation or view about what crypto is so keen to hear in 30 seconds or less. Can you give your best explanation of cryptocurrency? 

Kanish Chugh: [00:07:12] You don't time me on this, but I'll give it a okay, but I'll give it a crack. Look, I think the best way to explain cryptocurrencies is they are a digital form of currency, so they're not associated with a bank, a government, a corporation, and therefore a lot of people will classify them as being deregulated, which I think to many people is why they're most appealing. I think one thing with cryptocurrencies, they can be used for peer to peer transactions in store online. We've just seen Gucci announce that they're going to accept payment in Bitcoin as Emirates, for example, and the cryptocurrencies as a, you know, as a currency. They're based on the blockchain technology. So without blockchain, there is no Bitcoin or Etherium. And essentially the blockchain technology is a public ledger system where you have the public that can verify transactions and ownership. So there's no government, no corporation that owns Bitcoin or Etherium makes it really appealing because it's in a time of history where there's a lot of distrust. And I think just on those two cryptocurrencies was best explained to me by 21 chose who? The partner for our two crypto ETFs. Bitcoin is a safe haven asset. It's a finite supply. 21 million bitcoins that are available yet to be available, but that's roughly 21 million that you can essentially mine. So therefore it's like the digital gold. Etherium Is the infrastructure essentially with Etherium it is a decentralised blockchain technology. It is a blockchain really with smart contract functionality. And Aether is that native currency for the platform. So if Bitcoin is much like buying gold, Etherium is like buying a true infrastructure asset and that's probably probably a bit more than 30 seconds. But yeah. 

Sophie: [00:08:54] No, I actually love getting people's explanations on this as well because for us, you know, we're still learning about the crypto space and I feel like every conversation you have, you just get that little bit extra that you like, add to your knowledge and you're like, Oh yeah, I never thought about it that way. That's good. And I've as I've said, we don't talk about crypto as much as we talk about things like stocks and ETFs. So how does something like crypto fit into your portfolio? 

Kanish Chugh: [00:09:15] Crypto is really volatile. Look, I'm not going to shy away from that. It is a very volatile asset. It's a new asset class as well. So I talked about Bitcoin being very similar to gold. Gold has over a 20 year history and you know, we're very well versed in talking about gold because we've got the gold ETF, the physical gold product. But Bitcoin's only about 13 years old, for example. So it's very volatile. It's still a new asset. Now, where does it then fit into a portfolio? Well, firstly, it's for a particular type of investor that can absorb that sense of volatility. So it's not for everyone. Just because we've listed an ETF that allows you to easily access cryptocurrencies doesn't mean you should buy it. You know, it's for a particular type of investor that kind of. So high risk and high volatility. It also sits as what I would classify as a growth alternative. So if you think about a portfolio and you know, you guys may have talked about, you know, 60, 40, 60% equities, 40%, you know, fixed income or bonds or cash. There is an element of the traditional portfolio that would sit in alternatives. So 10%, 5 to 10%, depending upon your risk profile. So that 5 to 10% that sits in alts or alternatives within alternatives, it could be hedge funds, it could be infrastructure, it could be real estate, it could be defensive alternatives like gold, or it could be growth alternatives such as cryptocurrencies. So within that context, it's maybe two, 3%, maybe less within a portfolio. It is having some exposure to a really volatile asset. But potentially, you know, we've seen it go from 5000 to 60000. It's now sitting at around that $30,000 mark in Bitcoin. You know, it can potentially, you know, do wonders and do really return for portfolios, but it could also can be as volatile and go the other way from that perspective. So growth, alternative, very small allocation within a portfolio. 

Maddy: [00:11:12] I have to say, I think unfortunately since I started investing in crypto, it has only been on the down. I think I actually invested like pretty much the day it hit the top four for the first time. So I haven't had the best luck there, but I do. I have a long term conviction about what this is really leading me to ask is is now the right time to really be thinking about investing in crypto? 

Kanish Chugh: [00:11:36] It's an interesting time because obviously we've seen a real big pullback. You talked about the fact that from when you invested in it probably maybe 4 to 6 months ago, there's been this real big pullback to where it sits now. It's been hovering around that sort of 30,000 mark. We've had some investment banks come out that say the value of Bitcoin, for example, is sitting at about 38,000 U.S. So it's got a potential 25 to 30% increase from where we are now. When is the right time to invest? I think it's never about timing the market. It's about time in the market. And that's that's really important, whether it's cryptocurrencies, gold, equities, fixed income, etc.. It's about, you know, dollar cost averaging into an asset class or an investment. You know, I think that's these are all things that everyone talks about, but people actually need to then act on those things because I don't know when is the right time to invest in crypto? Is it now? Is it going to be in six months time? It's a really interesting point of in history where you've got inflation running really high, you've got central banks. Pretty much the only thing they can do to rein in inflation is to raise rates, and they're doing it as aggressively as possible. You know, the Reserve Bank raising rates by 50 basis points. Oh, so so yeah, the Reserve Bank, the central bank, the Fed doing the same. They're trying to basically aggressively rein in inflation. You've got geopolitical conflicts. You've got lockdowns in China with COVID. It's just there's so much that to unpack there that with the cryptocurrencies it's sitting around that 30,000 mark. US One thing I was looking at was the sentiment around Bitcoin at the moment. And it's funny, there is this potential, you know, idea to look at will retail have a lot of cryptocurrency exposure and they've been selling and that obviously then drags down the price of cryptocurrencies because there's this big sell off. But we're actually seeing over the past few weeks and obviously we're recording this in sort of the first week of June, we're actually seeing a real big shift towards institutional buying into cryptocurrencies and Bitcoin in particular. Now the how to how do I identify whether they're institutional? Well, it's a combination of their balance sheet and also the level of Bitcoin that they're actually buying and taking, taking on. So we've actually seen that start to shift. So is are they telling us something that every all the sort of retail investors that have tried to sell out now something that we don't know. And so that's why people are using this opportunity now as the market, the market's come off to buy into it. But as I said, it's not about timing the market. It's time in the market. And that's that's really important. So you're probably still got your crypto exposure, is you? 

Maddy: [00:14:23] Definitely. 

Kanish Chugh: [00:14:24] Yeah. And that's the thing with any investment such as these, especially as volatile as they are, if you try to time it, it can be fraught with danger. So it's about being in that for the long term, especially when you're thinking about what is a new asset class. It's going to have a lot of innovation, it's going to continue to develop and grow and its usage and how it's being adopted. Government policies around the corporate policies around it. They're any changing. They're constantly changing at the moment. 

Maddy: [00:14:49] Yeah so I'm am really trying to remind myself of at the moment is if I was willing to buy it back in November, December then I should absolutely be willing to buy it now at this lower prices easiest. Mother, I must say. 

Kanish Chugh: [00:15:01] Yes, exactly right. 

Sophie: [00:15:02] So I'm interested, though, because you kind of mentioned there that, you know, obviously there's a bit of a retail selloff which we can quite easily see. But then you say something like, you know, big institutions are buying. How do you kind of find this information about crypto and how do you keep up to date when things do move so quickly? 

Kanish Chugh: [00:15:18] So I think with the cryptocurrency market, it is moving so rapidly from a gold perspective. If I compare bitcoin and gold, you know, I look at gold and it is very relatively simple for me to understand what's driving the price of gold and the fundamentals behind it and to get access to a lot of information around commodities. You know, we live in Australia, so that's easy to do. I just have to open up any media publication and I've got that. But with crypto it is hard and there's a lot of misinformation as well. There's a lot of personal views, I think, with cryptocurrencies. And that's that's the really hard thing because, you know, we see the personal element of it, you know, whether you believe Elon Musk and what he's trying to do with Dogecoin, that we'll leave that for another time. But what I've tried to do is obviously we're lucky enough to have our partner for these products is 21 share. So there are Swiss based crypto fund manager, but they have a raft of information and we have actually been able to leverage their research. So at ETF Securities, we actually publish a weekly crypto monitor. It's sent out every Wednesday or Thursday and it's then stored on our website. We've got a crypto hub and that information. So I was talking about that institutional buying. I was actually referring to content, that research that 21 shares did and they were able to send to us and we've published that information for anyone to read so people can actually subscribe to that newsletter. And that is for me one of the best forms because it's bite sized, it's coming from a reputable source, you know, 21 shares. They've got a team of researchers, crypto enthusiasts and experts. You know, for me at ETF Securities, I've got to be across commodities, equities, growth, equities, value equities. I'm going to be across, you know, different regions, crypto currencies, fixed income, etc.. So it is one of those things where it's like we are able to leverage their research and their expertise and that's where I would go to for that information. 

Maddy: [00:17:15] Yeah, sounds awesome. And we'll be sure to share the links for that in episode notes as well because I know it's definitely something I'll be signing up to. I am really keen to understand what is your vision for the future of cryptocurrencies? 

Kanish Chugh: [00:17:29] I think there's a bit of a an untapped potential here for for cryptocurrency. So I talked about the fact that in my 45 seconds, I think had description of cryptocurrencies, but I talked about the fact that, you know, there is at the moment the appeal for cryptocurrencies is the decentralised nature of it. Now we are actually seeing more corporations actually adopt cryptocurrencies as a form of payment. So I mentioned Gucci and Emirates are just two examples. One of the largest group of retail stores in Dubai overnight announced that they were willing to or going to start to accept bitcoin. You're starting to see the domestic banks here in Australia. They've all talked about potentially doing something around cryptocurrencies or some, most of them have. And again, we're seeing a shift in that investment institutional bank level. So okay, we've got that element where there is this opening up of doors of digital currencies, whether it's Bitcoin or Etherium, but the digital currency element, you've also got governments, so you've got governments such as in Norway. And you know, again, we're recording this the first week of June, but around this period, Norway actually voted against banning Bitcoin mining, which was a proposal that was put forward to the government in March. Now they make about 1% of the global Bitcoin hash rate. So in terms of Bitcoin mining and production, it's not drastic, it's not massive. But again, it's something to be considerate of that you've got governments that are pushing against banning Bitcoin mining. You think of governments like Germany who are saying that there are tax incentives and potentially this tax, you know, tax freedom that they you know, they won't charge any tax on Bitcoin and Ethereum held for 12 months and any gains made for it at the moment, whether it's the currency or foreign exchange. So again, that's different to then Portugal, who traditionally is a crypto safe haven and a tax haven. They're starting to look at taxing holders of Bitcoin and Etherium or in cryptocurrencies and the exchanges. So it's this real dynamic at the moment. Where does the government sit on it? You know, you've got countries like Ecuador who are turning around saying, yep, we are the Bitcoin haven. You know, we'll accept everything. Bitcoin, Bitcoin is a currency, it's the future. But that really is probably going to be a bit of a hybrid that we will see over time because there will be an acceptance for cryptocurrencies. I think it does take time, though. It does take time. And the launching an ETF on it is just the next evolution of that. Because you had an asset class that was traditionally only accessible through unregulated exchanges. You now have this asset class which is available for Australian investors. And in Asia-Pacific, actually these are the first products in the whole of Asia Pacific physical, bitcoin, physical Etherium that you can access via a regulated exchange. So it is somewhat, I guess, prudent official nature to cryptocurrencies that sort of gives that bit of a tick of approval if regulators here in Australia are willing and we're quite conservative to, to be completely honest, I think, you know, the past few years, even though we were the first market to launch a gold ETF, we've been we've taken our time. You're taking us five years to launch cryptocurrency ETFs from when we first lodged that first product disclosure statement. So the fact that we can be here now is a step in the right direction. And so that's where I see the vision in the future for cryptocurrencies. And I think Etherium is a really important one because that's infrastructure, that's the technology. So that blockchain technology, whether it's to support and if TS, you know, the metaverse, etc., that's what you're actually going to be using. You're going to be using the Etherium blockchain technology. So that's actually going to be a really important one for people to look out for. 

Sophie: [00:21:12] I am really keen to get into the details of the products, but before we do, we're just going to take a quick break for our sponsors and we'll be right back to hear about all the advantages and disadvantages of investing in crypto via an ETF. So can you tell us a bit about your partnership with 21 shares? What is the products that you guys have actually created? 

Kanish Chugh: [00:21:34] Sure. So 21 shares essentially the partner that we've used to launch this crypto fund. So the ETF securities, we are an expert in ETFs domestically here in Australia, we've got over 4.7 billion under management amongst a range of ETFs, whether it's equities, leveraged funds, commodities, etc.. And we've been you know, we're coming up to our 20 year anniversary next year actually. So we're the second oldest in Australia, but we aren't crypto experts. And so we partner with 21 inches who are the crypto fund manager. They are the experts in this field. You know, they've got a roughly around you know I think it's nearly two and a half billion us that they manage in crypto. ETPs around the world though I was talking to and it's funny every day I speak to the team that's changing. They've got over 30 different exposures, so 30 different cryptocurrency exposures, whether it's, you know, Ripple Solana, Cardano, Bitcoin, Ethereum baskets, whatever you, whatever you name, they've got it and they've got over 130 listings. So they've listed these funds across Europe, across the different exchanges. So they are very much the experts and we leverage them to work out what is the best approach in terms of opening up and starting up a crypto ETF. So the ETFs 21 shares Bitcoin ETF. And then there's the ETFs, 21 shares Etherium ETF. So a BTC, an ETF. Now both of these are physically backed. Now, that's important because we were conscious that we could have, in theory, bought the 21 shares ETP that are listed on the Swiss exchange or the German exchange, etc. They've got these funds available. We could in theory go yet would is buy these will create a feeder fund where we're just buying another ETF that's listed. That would actually be the easiest. You know operationally that would be so simple to do. But we thought, no, it's better to actually provide like we've done with our gold product and the commodities products where it's a physically backed product, essentially with those with with our gold products, investors have a metal entitlement, so they have an entitlement on the gold that sits in the vault. So essentially they own some exposure of gold and they can redeem for the metal. So the same concept we talk with Bitcoin and Etherium, so we have a coin entitlement to each of these funds, essentially has a COIN entitlement and for Bitcoin investors can actually hold underlying Bitcoin that they've got. And it's an entitlement on that Bitcoin that they invest in or Etherium They can also redeem for the crypto as well. So it's as close to essentially buying and doing it themselves through a crypto exchange. But we take all the hassle for you and I think the apart there with both of those strategies is we access institutional grade custody. So why is that important? Well, unless you want to be that that person from Scotland who is throughout his computer and he's now sitting in the tip and he doesn't. 

Maddy: [00:24:31] Know so many horror stories. 

Kanish Chugh: [00:24:33] Well, there was I was listening to a Bloomberg show and they were talking about, you know, someone try and type in their password and the cat jumped on the keyboard. And all of a sudden, because you don't have many attempts and it's like, okay, they've lost everything. So we take all of that away from you. We essentially put it in institutional grade custody. And actually the wallets that we have are insured as well. They're insured against hacking, so they're insured against the loss of the crypto. So it's insured cryptocurrency that we essentially have. We obviously there's a fee that we charge for that and to do all of that sort of insurance and that the institutional grade custody. But I think that's the key part of it. We're trying to democratise investing in cryptocurrencies and it's not going to be for everyone. So I think people have asked us, well, why would I invest in a crypto ETF? And I think that that's a question in itself really. 

Maddy: [00:25:30] You mentioned phase in there, and I know Sophie and I often talk about when we are looking into different ETFs and sort of comparing them phase is quite an important factor. Are the fees higher on this on these ETFs and sort of what is the justification around that? 

Kanish Chugh: [00:25:44] So these ETFs, both of them are charging 1.25% per annum. So if you held the fund for an entire year, that would be your fee. If you obviously held a fund for a six months, you that would be halved. So it all depends on how long you hold the fund. The fees are higher definitely compared to traditional equity funds or even traditional commodity funds. But this is a new asset class where there are higher costs associated with the custody, the holding of the cryptocurrencies. I think that's been something that was surprising to us because obviously we're very well versed in equity funds and commodity funds and you know, we can potentially access those at a much more cost efficient. Whereas with cryptocurrencies we were very much surprised at how expensive that custody was. Now part of that is obviously to do with all the frameworks around, you know, protecting against hacking and, you know, all the different technology that's required with it. I think it's also a new asset class. So you've got new companies associated with this and they're essentially over time, as it becomes more institutionalised, as they get more experience, more cost efficiencies will start to come into play and that will allow us to lower the fees. But I think for me, what was surprising was the custody fees. It was significantly, you know, multiple times higher than what we've ever had to look at for our existing strategies. And then when I look at the fees relative to overseas markets, so you have Bitcoin ETFs in Canada and Europe and in particular, you don't have one in the U.S. yet, but you do or physical anyway. It is pretty much on par with what you would see offshore as well. I'm from that side, but yeah, the custody is a big part of it. 

Maddy: [00:27:26] They should offer a discount if the value of your ETF goes down. 

Sophie: [00:27:30] So then can I ask the question that you said? There's a question in itself when you say why would you invest in a in an ETF? Is it because it is overall less risky that you have someone storing it for you, someone's insuring it? Is that the reason why people would look towards an ETF? 

Kanish Chugh: [00:27:46] So, Maddy, you mentioned that you have obviously invested in cryptocurrencies already and you went down that path to say, look, I really want to invest in cryptocurrencies, I'm going to open up a wallet, go on to an unregulated exchange and do that. So that's something that you have done already. But for a lot of people, they've sat on the sidelines. They're scared around doing that or they're unsure. They don't want to take that step, but they really want to invest. You know, they want to invest in Bitcoin. They want to invest in it here, but they're not sure which which which exchange should I use? Do I use the one that potentially make it? How do I use the one that potentially shuts down? Do I use one that potentially is going to be used in fraudulent activities? I don't know. So yeah, but but I think, I think from that perspective that's way well that that's why we launched the ETF. Oh yeah, exactly. So from that perspective, it is for those people. So the crypto bulls or the crypto enthusiasts have already done this. It's not for them. Well, it potentially is for them if they want to include it within their super, etc.. We're providing a very easy way for them to do so. But for a lot of investors and when we talk to the founders of 21 shares and that's Hanny and Ophelia, and these are two really smart individuals, I think they're actually younger than me, which which is which is really scary, given how much they've accomplished. I'm like, okay, well, but what I what I actually found with both them was they launched 21 shares because they were talking to their parents and their parents wanted to invest in Bitcoin and it was actually their mothers and they were like, We don't know what to do and we don't want to go to any of these crypto exchanges. And they were like, Well, there must be an easy way. And then they went down this rabbit hole of Atp's By the way, I never knew what an ATP was before this, apparently. And they went down this rabbit hole, looked at Atp's and looked at an exchange, had a product, an exchange, traded funds, and launched what is now 21 inches the biggest crypto fund manager. So it is for them from a risk side. We talked about custody, we talked about security. I think that's the key part. We take all that away from the investor that we try to de-risk it in some way. There's obviously always going to be risk, but we try to de-risk a lot of those those key risks that you may generally have, you know, keeping that key safe. I think there was a Hamish and Andy episode where they bought one Bitcoin. Yeah. And they're still trying to work out. 

Maddy: [00:30:04] Yeah, I can confirm. 

Kanish Chugh: [00:30:06] Yeah. There you go. So, you know, they're sitting on how many bitcoin or whatever X amount is, but they wouldn't have that problem if they bought the ETF. 

Maddy: [00:30:15] I'm I totally know this already, but for someone who is an across it, what is an ATP. 

Kanish Chugh: [00:30:22] Exchange traded product? So if you think about the the fam, the family of the ETF belongs to the family of exchange traded products essentially. So the ATP ETF, they're very much one and the same thing.

Maddy: [00:30:32] Where every guy you mentioned or we mentioned off the top of the episode that these ETFs are listed on the Sabre, not the ASX. Can you explain that? 

Kanish Chugh: [00:30:46] Yes, sure. So Szabo, Australia. It was formerly known as Kayaks, which is essentially an alternative exchange to the ASX. So think about in the US where you've got the New York Stock Exchange, but you've also got the Nasdaq as well. So you've got sort of two exchanges and the market there has grown to a size where they can actually support more than those too. They've got many other exchanges as well. In Australia, the ASX was the primary exchange and we have listed many of our funds on the ASX and we will continue to do so. But we were given the opportunity to look at utilising the Chinese or now as called Cibo. CBOE, Australia and their exchange. And essentially it's an alternative exchange. So to the actual investor do they know, you know where they go on CommSec or self well superhero shares is whatever it is stake etc.. Do they actually know when they're buying a stock or buying an ETF which exchange it actually ends up routeing through? Probably not. And it could actually rally through BO CBOE or it actually could route through the ASX because a lot of a lot of products across listed. But for these products we chose to launch it with CB Australia. One, it's good to have competition in the market. I think that that's always positive. SIBO obviously allowed us to also be first to market as well. So that was a positive and that was really important to us to ensure that we were able to launch the first physical bitcoin and ethereum's in Australia. 

Maddy: [00:32:15] So each episode we have been asking our guest to add a stock company news trend or industry to our watch list. And the purpose of this really is to get us thinking outside of the box and broaden our horizons in the investing space and our financial advisors. And it is just for educational purposes. But I'm very excited to hear. What are you bringing to the watch list today? 

Kanish Chugh: [00:32:38] Sure. So for me, it's actually a bit of a boring one, but I think an important one. And that is gold. Um, so, yeah.

Maddy: [00:32:47] So it's been added to the watch list. 

Kanish Chugh: [00:32:50] There you go. Good. Yeah, because I figured there'd be a lot of sort of momentum stocks or, you know, tech and thematic ETFs. And I did think, should I talk about like semiconductors or something like that? But I thought, no, actually, gold's a really interesting one because essentially for us, I talked about how Bitcoin is a growth alternative, gold is a defensive alternative. So gold is your portfolio insurance. So it's not a gold mining stock, it's not like a Newcrest or anything like that. It essentially is a commodity and we've got the physical gold product gold. So how do you how do you essentially use its portfolio insurance? So when you have a house or a car and you don't insure the house and the car after the car gets stolen or after a fire in the house, you want to do before the same concept with gold as a portfolio insurance. So we want to have that in the portfolio beforehand. Again, depending upon someone's risk profile, we'd generally seen gold be used between 2 to 5% in a portfolio. We've got some clients that go very bullish, 10%, 15% in a portfolio into that depending upon how they see the world going. But in a climate of equity volatility, geopolitical events, inflation, rising gold is a really good hedge to those types of events. So for me it's physical gold, it's boring, but you know, it works and it's worked for it for centuries. 

Maddy: [00:34:09] So we do track the overall returns from our watch list. So hopefully this will help to this. 

Kanish Chugh: [00:34:15] Will stabilise it. 

Maddy: [00:34:16] But as I said. 

Sophie: [00:34:18] You know, what I also think will be funny is that when we were recording this podcast with guests over 2021, everyone was obviously feeling very bullish. And we had a lot of, you know, tech stocks added. So now everyone, Drupal, our guests are more defensive. So the watch list. 

Kanish Chugh: [00:34:33] Exactly just pure cash will. 

Sophie: [00:34:35] Well, now to round out the episode, we wanted to ask, what would be your piece of advice for someone who is starting out on their journey. 

Kanish Chugh: [00:34:45] To I think on the crypto journey, it's making sure you read information, do your research, obviously, but read it from reputable sources. Don't follow the herd and don't don't follow the momentum or the trend. You don't invest according to what your your beliefs, your risk profile is and how you want to invest. I think that's really important. We get sometimes caught up in media headlines and, you know, often the media headlines will always be about a negative. It's never really about, you know, the positives. So when Bitcoin jumps 5% overnight, we don't necessarily here too much about that. We always hear Bitcoin's dropped $3,000 or $2,000 or 10%. So when I talked about the crypto hub that we obviously have, you know, that is a bit of a plug there, but it's really around going to reputable sources don't going not going to people that just offer personal fees and don't follow that that herd and that trend and do your research and invest accordingly with crypto because it is volatile so don't bet your house and it is something that I would say you know, be diversified across different asset classes and cryptocurrency could just be one of those exposures. 

Maddy: [00:35:53] Some sage advice I do feel slightly is that when you talk about going with momentum, but I'll look past that and just thank you so much for joining us today. It's very exciting to hear that. Finally, we do have some new options in the crypto space in the two ETFs that you guys are launching. So I appreciate you giving us all the intel we need now. 

Kanish Chugh: [00:36:13] Thank you guys for having me. 

Maddy: [00:36:14] This is such a great chat with Kanish and I have to say he was talking in there about how the owners of 21 shares are creating a product for their mums and. I was laughing because my mom and I know I can say this because she wrote listen to this episode. She listens to every episode of anything related to crypto. She refuses.

Sophie: [00:36:35] I don't know if my mom would know what bitcoin was like. Maybe I'll test. I'm getting dinner with her tomorrow night. I reckon I'm going to Alaska. I'm going to ask her actually for what her best definition of a Bitcoin is, and then I'm going to actually make it in your record. Yeah. 

Maddy: [00:36:49] My mom actually got angry at me when I told her that I invested in cryptocurrency. 

Sophie: [00:36:54] Oh, my gosh, moms, come on all the time. If you are wanting more information about the crypto space, we will definitely be posting about it in our Facebook community and have a bit of discussion going on there. YIGC Investing Podcast Discussion Group. 

Maddy: [00:37:11] As always, post your question. Send us DMS on Instagram. Why did you say podcast? And if you can, we would really appreciate you liking subscribing and reviewing the podcast, sending it to a friend, whatever you can do to help. We appreciate it. 

Sophie: [00:37:25] And follow us on Instagram at why I chose the podcast. I said that, oh sorry.