You Might Regret Ignoring This Little-Known ETF That Combines the Power of the S&P 500 and Bitcoin

History has shown that one of the simplest ways for investors to consistently provide their portfolios with the best the market has to offer is by investing in the S&P 500 (SNPINDEX: ^GSPC). The S&P 500, which consists of the top 500 U.S. companies, has returned an average of 10% per year over the long term.

^SPX Chart

An average return of 10% (which includes up and down years) is nothing to sneeze at, but there are better opportunities in the market for a growth investor with a long-term horizon (and greater risk appetite). Often this means investing in riskier stocks, including technology companies at the cutting edge of innovation, because they have significant long-term potential. But there is another asset that is proving to be a valuable addition to portfolios: Bitcoin (CRYPTO: BTC).

Image source: Getty Images.

Bitcoin effect

Over the last five years, Bitcoin has increased by more than 675%. As we move further out, the cryptocurrency becomes much more bullish. The reason behind Bitcoin’s massive appreciation is subtle, but the important thing to note is that it still has plenty of potential to continue growing.

While blockchains and cryptocurrencies have significant potential to transform financial markets, the majority of the crypto asset class is rife with speculation. For several reasons, Bitcoin is the safest investment when it comes to crypto. The crypto market is worth $2.57 trillion, and Bitcoin accounts for more than 50% of that value. What this means is that as Bitcoin moves forward, so does the rest of crypto.

This makes it a great proxy for investors to gain exposure to the emerging potential that crypto has without having to pick and choose individual winners, like investing in the S&P 500.

What if investors could invest in Bitcoin and the S&P 500 through a convenient exchange-traded fund (ETF)? Enter OneFund’s Cyber ​​Hornet Bitcoin Strategy ETF (NASDAQ: ZZZ).

What makes this ETF unique?

This ETF is the only one of its kind. It allocates 75 percent to the S&P 500 and the remaining 25 percent to Bitcoin futures contracts. Launched in December 2023, Bitcoin and the S&P 500 have returned a generous 20% over the past six months, and both are near all-time highs.

The beauty of the Cyber ​​Hornet ETF is its simplicity. By adding this ETF to your portfolio, you will gain exposure to the most valuable cryptocurrency on the market and with it the gains that only Bitcoin can provide. In addition, investors put their money to work through leading companies in the S&P 500, including Microsoft, Nvidia, Apple, and many other brands.

The story continues

The key advantage this ETF offers is the mix of old and new. The 75% allocated to the S&P 500 provides a buffer against the volatility and significant declines that have historically plagued Bitcoin every four years. A 25% allocation to Bitcoin gives investors a chance at a growth spurt.

Consider 2022, for example. Meanwhile, Bitcoin and futures contracts fell more than 65%, while the S&P 500 fell 19%. Even though the Cyber ​​Hornet ETF was not trading at the time, it could have lost approximately 30% in value given the allocation. Don’t get me wrong, a 30% drop isn’t ideal, but this example shows how investors are protected from the worst of Bitcoin’s corrections due to the ETF’s unique allocation strategy.

Now, on the contrary, in 2023 the S&P 500 has grown by 24%. Again, the Cyber ​​Hornet ETF would have demonstrated its true strength even if it had not traded, posting a commendable 59% return, mainly due to Bitcoin’s resurgence and Bitcoin futures contracts rising roughly 165%.

This Bitcoin/S&P 500 ETF may be right for you if:

Maybe you’ve heard about Bitcoin’s ability to rise significantly in a short period of time, or you’ve heard about the recent approval of spot Bitcoin ETFs, but you’re still hesitant to jump in. Maybe you’re not sure how to buy Bitcoin on a crypto exchange or how to operate a digital wallet.

If that’s the case, but you’ve done your research and believe in Bitcoin’s long-term potential, the Cyber ​​Hornet ETF may be the right choice for you.

Now, it needs to be made clear that this ETF is not for an investor who is approaching retirement and doesn’t have much time to recoup losses. While Bitcoin has proven its ability to generate significant returns as a byproduct of its limited supply and increasing adoption, it is not without its corrections.

For those with some time, the Cyber ​​Hornet ETF offers a balance that few other ETFs can provide; A blend of the best of crypto and the best the traditional exchange has to offer. Your money can benefit from Bitcoin’s long-term trajectory while being protected from the high volatility that often occurs when investing in cryptocurrencies.

Should you invest $1,000 in the Cyber ​​Hornet S&P 500 and Bitcoin 75/25 Strategy ETF right now?

Before buying shares of the Cyber ​​Hornet S&P 500 and Bitcoin 75/25 Strategy ETF, consider:

The Motley Fool Stock Advisor analyst team identified what they believe are the 10 best stocks for investors to buy right now… and the Cyber ​​Hornet S&P 500 and Bitcoin 75/25 Strategy ETF wasn’t one of them. The 10 stocks that made the cut could deliver monster returns in the coming years.

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RJ Fulton has positions in Bitcoin. The Motley Fool has positions in and recommends Apple, Bitcoin, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

You May Regret Ignoring This Little-Known ETF Combining the Power of the S&P 500 and Bitcoin appeared first by The Motley Fool