Quote from: jbreher on January 06, 2015, 05:44:16 PM

Quote from: QuestionAuthority on January 06, 2015, 05:11:33 PM

Quote from: Mortimer452 on January 06, 2015, 04:28:11 PM

Quote from: QuestionAuthority on January 06, 2015, 03:15:43 PM

Read this and tell me if you believe Bitcoin will be a sound ETF investment for knowledgable players.

Quote

5. Finally, very new or very small ETFs sometimes trade inefficiently, resulting in wide spreads between their buy and sell prices or failure to track their benchmarks accurately. Wait for an ETF to gather at least $100 million in assets before you invest in it.

#2 and #5 are about the only ones that really matter - crypto's are always a risky investment (at least right now). The risk/reward ratio is a factor, but trading volume is going to be what drives whether the big money gets involved. If COIN is only moving $100k per day in volume, none of the big boys are going to bother screwing with it.

Agreed, 2 and 5 are the killers.

Granted, I don't know too much about investments pushed by pinstriped bandits. However, my impression of the average ETF is that it contains a basket of multiple securities, no? If so, why would a single-security ETF (e.g. COIN) be affected by #5 at all? The effort required to track a single security (e.g. Bitcoin) should be trivial, and therefore very efficient, should it not?

I believe this has more to do with internal management of the fund than anything. Basically, how efficient & fast they are at fulfilling orders and reacting to price fluctuations in whatever they are benchmarking. When you are day trading (or bot-trading) and seconds matter, this comes into play.