WisdomTree has launched the Efficient Gold Plus Equity Strategy Fund (Cboe BZX: GDE). The new exchange-traded product gives investors exposure to large-cap equities and gold. Jeremy Schwartz, Global Chief Investment Officer at WisdomTree, explained that for every $100 invested in the ETF, $90 is invested in large-cap stocks. The other $10 is used as short short-term collateral to fund in gold futures.
ETF Newz Says: This is becoming a new ETF strategy to launch a fund with large cap equity exposure with a natural hedge in it. We saw another fund launch last week with bitcoin exposure. Dual purpose fund strategy reducing the overall holdings an investor may need. “If you wanted to add a 3% position in gold, typically, you would sell some of your stocks to add the 3% gold,” he said. “With this new ETF, you could take that 3% and have 90% in stocks and be fully aligned with gold. If you think gold is a good long-term inflation hedge, you could protect your entire allocation to large-cap stocks without selling your stocks.”