Franklin Templeton has filed for two new ETFs to be listed on the Nasdaq exchange. Each fund will initially consist of 95% equities and 5% Bitcoin exposure. The first fund tracks the 500 largest US companies, while the second focuses on the 100 biggest Nasdaq-listed firms, excluding financial entities.
The core strategy involves reinvesting all regular and special dividends into Bitcoin on the market open following the dividend ex-date. This mechanism aims to increase Bitcoin exposure over time. The larger fund will charge an annual fee of 0.09%, which equates to $9 for every $10,000 invested in the first year.
The funds include a rebalancing mechanism to maintain the target allocation. If Bitcoin exposure exceeds 5% on a quarterly basis, it will be trimmed back to 4.5%. Additionally, if the allocation surpasses 20% between quarterly reviews, it will be reset to 4.5% within two business days.
The ETFs will not hold Bitcoin directly. Instead, they will invest in other Bitcoin funds, including those affiliated with Franklin Templeton, as well as futures and options. The company noted that it may waive fees on its own products, though this waiver can be terminated at any time.
