EXUP: Independent Brand of Financial Derivative Under ChainUP ChainUP Follow Apr 16 · 3 min read

EXUP is a new subsidiary brand under ChainUP, designed to be as efficient as possible when it comes to setting up a blockchain financial derivatives platform. It focuses on the blockchain financial derivatives market. This market has grown in demand because of the developing blockchain ecosystem, which has seen traders from the traditional finance markets connect with their blockchain counterpart. EXUP’s vision is to take account of this change by allowing clients to create fully-featured blockchain financial derivatives platforms quickly and easily.

ETF is an essential part of EXUP’s feature lineup. ETFs are a popular staple in the finance industry. By offering blockchain-based ETFs, it is possible to tap into a flourishing market of traditional finance users that have exhibited an interest in the blockchain and introduce them to the ecosystem. They are also customizable to fit the demands of the users.

What is ETF (Exchange Traded Fund)?

In essence, it is a fund that can be traded on the exchanges. Of course, it is also called a “tradable index fund” in most explanations. It can be traded on the exchanges, and it can track the prices of a commodity or the portfolio of a group of commodities.

Correspondingly, in BlockChain finance, we regard “valuable token” as the “commodity” when tracking the prices.

Characteristics of ETF Funds

The definition of ETF indicates that it has the genes of 50% token (parallel to stocks) and 50% portfolio, which is a hybrid product of the two. Therefore, ETF has the following characteristics.

Fund Gene — with NAV (net asset value) mechanism

In the OTC funds, it is mainly used for price recognition and profit accounting of redemption. NAV is the price of each fund share.

Fund Gene — clients may apply to the issuer for redemption at any time

Fund companies are obliged to guarantee that investors can use the unknown price of the following settlement cycle (the amount at any time during the opening period) for a subscription of fund shares and use the following unknown prices for the redemption of shares.

Unique Trading Features of ETF

Investors can buy and sell fund shares in exchanges at market prices, which are determined by the market.

Why do Investors Choose ETF?

Low Cost

The sum of the handling fee plus management fee and transaction commission is lower than the contract handling fee.

Arbitrage Mechanism

The existence of an arbitrage mechanism makes the net value of funds consistent with the transaction prices of secondary markets.

No Liquidation

It rebalances the portfolios behind the leveraged ETF products on a regular basis so that the portfolio leverage ratio does not deviate largely from the agreed ratio.

Transparent Portfolios and High Efficiency of Tracking

Portfolio composition is open and transparent (by publishing portfolio composition files, publishing indicative optimized portfolio values, and shares). The cash drag is low. The investment positions are high, which is close to 100%, and the tracking efficiency is high with good effects.

Low Investment Cost

It saves time and energy for investors to choose coins. That is, investors only need to invest in the ETFs linked to the sectors they are optimistic about, which greatly saves time cost and opportunity cost for them.

Product Advantages

Safe and Reliable

At any time, subscription and redemption can be made available at the following NAV, enabling part of the effective liquidity at the day level.

Trading Opportunities

Creates more subscription and sale opportunities for arbitrage, to attract more investors to create shares.

Efficient Tracking

Reduces daily tracking errors.

Cost and Profit (for Merchants)

Management Expenses

Fund management expenses collected within the cycle (including the transaction expenses generated by positions rebalancing and the expenses of underlying assets).

Transaction Expenses

Expenses incurred by the fund account for placing orders on a third-party platform.

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