Asset Management
Asset Management

Frequently Asked Questions

What is an index?

An index is a measurement of the financial performance of a defined group of assets. For example, the S&P 500 is a measurement of the performance of large-cap US equities.

An index is displayed as an ‘index level’, a number that shows how the index has performed over time. Unlike actual assets, e.g. stocks, an index doesn’t have its own price in dollars.

What is an index fund?

An index fund is an investment vehicle that tracks an index. It enables investors to get returns that track the index, by investing in the fund.

Index funds exist for many asset classes, including some of the most well-known indexes like the S&P 500 and the Russell 2000.

Who can invest in Coinbase Index Fund?

At this stage, you must be a US resident, accredited investor to invest in Coinbase Index Fund.

How does Coinbase Index Fund work?

Coinbase Index Fund invests in digital assets in proportion to their weighting in Coinbase Index.

Each time that an investor invests in the fund, the fund deploys the investor’s capital by buying assets in proportion to their weighting in the index. When an investor wants to leave the fund, the fund can sell assets in proportion to their market weighting in the index at that time, and return the proceeds to the investor. Subscriptions and redemptions occur monthly, with a 30 day notice required for redemptions.

Please refer to these important notices regarding Coinbase Index Fund.

Does Coinbase Index Fund have target allocations for each asset?

No. The objective of Coinbase Index Fund is to match the composition of Coinbase Index. Unlike actively managed investment funds, the fund manager does not actively trade assets, or target a specific allocation for any asset.

Please note that due to fees, expenses, and tracking error, the returns realized by investors in the fund may differ from the returns of the index. Please refer to these important notices regarding Coinbase Index Fund.

How often does Coinbase Index Fund rebalance?

Coinbase Index Fund aims to match the composition of Coinbase Index. We rebalance the Fund at least monthly, or more frequently if needed to ensure that it matches the composition of the Index.

Who operates Coinbase Index Fund?

Coinbase Index Fund is operated by Coinbase Asset Management, Inc. and Coinbase Fund Manager, LLC (“CBAM”) which are affiliated entities of Coinbase, Inc.

Is Coinbase Index Fund separate from Coinbase?

Yes. CBAM and Coinbase are dedicated to the principle that Coinbase Index Fund will be operated separately from Coinbase to ensure the integrity of trading on Coinbase.

Both CBAM and Coinbase have adopted policies and procedures intended to ensure that Coinbase Index Fund will be operated separately and that the fund will be treated no differently than any other customer of Coinbase. For example, these policies and procedures require that:

  • CBAM is a separate legal entity from Coinbase, Inc.
  • CBAM does not have any priority over other Coinbase customers in the placement and execution of orders on Coinbase.
  • Access to non-public Coinbase information will be appropriately restricted within Coinbase and CBAM, and the compliance departments of both CBAM and Coinbase will actively monitor the fund's trading activity, to help ensure the integrity of the Coinbase trading environment.

In addition:

  • The investment strategy for Coinbase Index Fund is public: buy and hold the assets in Coinbase Index in proportion to their weighting in the index. Buy and sell orders for Coinbase Index Fund are executed algorithmically in accordance with established procedures, with only limited input from CBAM personnel.
  • CBAM personnel are required to disclose all holdings of digital assets and are prohibited from personal trading of digital assets without pre-clearance.