Asset management giant Guggenheim submits new fund filing to SEC, seeking crypto investment exposure

Asset management giant Guggenheim filed a filing with the U.S. Securities and Exchange Commission (SEC) on Tuesday, applying to launch a new fund called Guggenheim Active Allocation Fund.

The fund's investment objective is to maximize total return through a combination of current income and capital appreciation, the filing said. The fund will employ a tactical asset allocation strategy (dynamic allocation across asset classes) as well as a relative value-based investment strategy that uses quantitative and qualitative analysis to seek securities with attractive relative value and risk/return characteristics.

To achieve its investment objective, the Fund will seek to invest in a variety of fixed income and other debt and preferred equity securities selected from different industries, including government and agency securities, corporate bonds, structured finance investments, etc.

The Fund may also invest in common stocks, limited liability companies, trust certificates and other equity investments (“common equity securities”).

Scott Minerd, associate adviser responsible for the day-to-day management of the fund's portfolio, believes these investments offer attractive yields and capital appreciation potential. The fund plans to use various valuation models to determine the appropriate allocation between asset classes.

As part of its common stock securities strategy, the Fund may employ the strategy of selling call options and may from time to time buy or sell put options on individual common stock securities.

In addition to this strategy, the Fund may, to a lesser extent, engage in strategies that involve selling call and put options on security indices and security sectors.

Page 7 of the document reads: "The Fund may seek exposure to cryptocurrencies, particularly Bitcoin, through cash-settled derivatives, such as cash-settled exchange-traded futures, or through investment vehicles that provide exposure."

Scott Minerd has warned crypto investors that market volatility will continue in the short term and predicted that it will take some time for the cryptocurrency market to recover, but Bitcoin and Ethereum will eventually be among the very few survivors.