CHICAGO / LONDON (IT BOLTWISE) – Amplify ETFs has launched a new ETF based on XRP, offering investors an innovative way to earn monthly income. The Amplify XRP 3% Monthly Premium Income ETF combines the benefits of covered call strategies with the dynamics of the cryptocurrency market.
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Amplify ETFs, a company with over $16 billion in assets under management, has launched the Amplify XRP 3% Monthly Premium Income ETF (XRPM). This ETF is the first of its kind based on XRP and follows an options income strategy. The fund’s goal is to generate an annual options premium income of 36% while also generating a monthly income of 3%. This is achieved by selling call options on 30% to 60% of the XRP portfolio, while leaving the remainder unhedged to benefit from potential price gains.
Covered call strategies are known for generating stable income by selling call options on existing portfolios. Part of the potential price gain is exchanged for regular bonuses. A call option gives the buyer the right, but not the obligation, to purchase an asset at a set price before a specific expiration date. Amplify ETFs sees this strategy as an opportunity to offer investors both stable income and the opportunity for price gains.
The XRPM ETF is part of Amplify’s YieldSmart product range, which aims to combine income generation with growth potential. The fund is actively managed and has an expense ratio of 0.75%. The distributions are made monthly. Amplify Investments is acting as investment advisor, while Kelly Strategic Management and Penserra Capital Management are acting as subadvisors.
The market for XRP-based ETFs is gaining momentum. XRP is the fourth largest cryptocurrency with a market capitalization of $132 billion. It serves as the native currency of the XRP Ledger, an open-source blockchain designed for fast, scalable and low-cost global payments. Recently, Canary Capital launched the first standard spot XRP ETF on Nasdaq under the ticker XRPC, offering US investors direct access to the cryptocurrency.
The launch of XRPM and other XRP ETFs shows the growing interest in cryptocurrency-based financial products. These products offer investors new ways to benefit from developments in the crypto market while minimizing risks through strategic hedging. Experts expect that demand for such innovative financial products will continue to increase as more and more investors look for diversified sources of income.
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