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Crypto exchange-traded products top Morningstar list

By Angela Barnes

17:46, 8 November 2021

Bitcoin crypto concept on blue integrated circuit on background
Bitcoin crypto concept on blue integrated circuit on background – Photo: Shutterstock.

Cryptocurrencies topped Morningstar’s monthly round-up of the best and worst performing European exchange-traded products (ETPs). Natural gas and Brazilian exchange traded funds (ETFs) finished at the bottom.

Morningstar said on its website the October list was led by SEBA Polkadot ETC, which launched in July on the SIX Swiss Exchange by issuer SEBA Bank.

“Actually, the whole podium was dedicated to the DOT, the native cryptocurrency of Polkadot, a blockchain interoperability protocol founded in 2016. The token’s price started its upward journey with $5.88 in November 2020 and never looked back since then (as of 2021 5 November it is worth $51.76),” Morningstar said.

Ethereum and Bitcoin

Ethereum and Bitcoin followed. Ethereum set a all-time high of $ 4,642 on 4 November in the wake of the implementation of Altair, a technological upgrade to Ethereum's Beacon Chain that made the network faster, safer and more secure, it said.

The first Bitcoin ETF launched in the US in October, helping boost the price of the cryptocurrency. The ETF allows customers to invest in Bitcoin futures contracts, rather than Bitcoin itself. Morningstar says the launch is unlikely to have an impact “beyond the very short term.”

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XRP/USD

0.54 Price
-1.670% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.01168

BTC/USD

60,073.45 Price
+2.380% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 21:00 (UTC)
Spread 106.00

DOGE/USD

0.11 Price
+0.760% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.0012872

ETH/USD

3,195.12 Price
+0.880% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 21:00 (UTC)
Spread 6.00

Natural gas and Brazil

Meanwhile, the monthly round-up also revealed that October was not such a good month for natural gas and Brazilian stock investors.

“BNP Paribas’ HENRY HUB ERDGAS ETC, a collateralised exchange-traded commodity incorporated in Germany that tracks the total return of the rolling Henry Hub Natural Gas Futures lost 10.4% in October. The ETC ranked as top performer among European-domiciled ETPs in September, but was among the biggest losers last month,” it said.

Additionally, Morningstar said in the monthly round-up that the negative momentum is still continuing for Brazilian equity, which has fallen 22% in the last three months and slipped among the worst domestic equity markets of the year.

“Latin America’s largest economy is paying on one hand the price for the slowdown in China, as one of its major trading and export partner, and an unstable political situation, on the other. Four senior Treasury officials resigned on 21 October, following the government's intention to raise the constitutional spending limit to increase welfare spending, in a pre-election move by President Jair Bolsonaro. This move has troubled international investors, on top of Brazil's ongoing Covid crisis,” Morningstar added.

Read more: Crypto market cap hits trn for the first time in history

Markets in this article

BCH/BTC
Bitcoin Cash / Bitcoin
0.00633 USD
-0.00027 -4.210%
DOT/USD
Polkadot / USD
6.3076 USD
0.0131 +0.210%
DOT/USD
Polkadot / USD
6.3076 USD
0.0131 +0.210%
ETC/USD
ETC/USD
22.987 USD
0.082 +0.370%
ETC/USD
ETC/USD
22.987 USD
0.082 +0.370%

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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