Blackrock, a leading multinational investment firm, has been making strides in the digital asset and web3 landscape. Its latest move involves launching an exchange-traded fund (ETF) with a focus on the metaverse, allowing investors to capitalize on its potential. The newly introduced iShares Future Metaverse Tech and Communications ETF (IVRS US) is listed on the NYSE Arca and has an expense ratio of 0.47%.
The fund, which was created on February 14, targets companies that are working on further developing the metaverse ecosystem and tracks the Morningstar Global Metaverse & Virtual Interaction Select Index. As of February 17, the fund had a net asset value of $5.02 million and a daily trading volume of 410.
On the same date, data showed that 72.4% of the Index’s total holdings were in US-listed stocks. Other countries with significant representation in the fund include China (10.2%), South Korea (3.6%), France (5.1%), and Japan (8.2%). Most of the fund’s IT industry allocation is directed towards stocks such as Meta Platforms, Apple, Nvidia, Roblox, and others.
Last October, rumors about Blackrock’s metaverse-themed ETF emerged, and it is one of several such ETFs already launched in the United States. The Roundhill Ball Metaverse ETF is presently the most prominent one.
As per recent reports, the Blackrock fund has imposed a $300 million market capitalization requirement and a minimum trading volume of $2 million for companies seeking to participate in the fund. The fund has implemented a rating system that assigns each listed company at least one of six relevance scores based on the metaverse sub-theme.
The six scores under the metaverse sub-theme include Wearable Technology and VR/AR, Enhanced Social Media, 3D Rendering and Simulation Software, Metaverse Platforms, Immersive Gaming, and Digital Assets & Payments.
These scores assess the firm’s potential to benefit from any sub-theme, evaluating the company’s five-year revenue prospect for the sub-theme. Depending on the level of revenue exposure to sub-themes, the Index will rate either tier one or tier 2 companies. However, the report states that this index fund will undergo rebalancing at the end of each year, specifically in December.