Rex Investment Fund is a relatively new cryptocurrency investment company founded in 2018. Over the past few years, it has quickly grown to manage over $100 million in digital assets. Rex Fund mainly invests in major cryptocurrencies like Bitcoin and Ethereum, but also allocates a small portion to emerging blockchain projects.
In this article, we will learn more about Rex Investment Fund, including its investment strategies, portfolio composition, performance history, and more. There will also be comparisons to other crypto investment funds like Grayscale and discussions around the rise of institutional investors in the cryptocurrency space.
Investment Objective and Strategies of Rex Fund
The Rex Investment Fund aims to generate long-term capital appreciation by investing in a diversified portfolio of digital assets. Its core strategy is taking concentrated positions in major cryptocurrencies, including Bitcoin (50-70% of AUM), Ethereum (15-30%), and other top altcoins. The fund also allocates 5-10% to early-stage blockchain projects that have growth potential.
Unlike passive index funds, Rex Fund is actively managed with the goal of outperforming the overall cryptocurrency market. Its investment team applies top-down macro analysis and bottom-up fundamental research to select assets with the best risk-reward profile. They also utilize technical analysis and algorithmic trading strategies to optimize entry and exit points.
Portfolio Composition and AUM Growth
As of December 2022, Rex Fund had over $120 million of assets under management (AUM), up dramatically from $32 million in January 2021. The vast majority of capital comes from high net worth individuals and family offices.
Bitcoin makes up 62% of the portfolio, while Ethereum is 20%. Other major holdings include Solana, Polkadot, Avalanche, and Chainlink. In terms of emerging crypto assets, Rex Fund has invested in tokens related to decentralized finance (DeFi), non-fungible tokens (NFTs), crypto infrastructure, and more.
Rex aims to keep the portfolio concentrated in its highest conviction picks instead of diversifying extensively like index funds. So far, this active approach has paid off nicely.
Investment Performance and Benchmark
Since its inception in 2018 through the end of 2021, Rex Fund delivered cumulative returns of over 1,000% net of fees. This handily beat its benchmark – a composite index of 65% BTC, 30% ETH, and 5% Top 10 altcoins – by approximately 400% over the same period.
Much of the outperformance can be attributed to well-timed trades in altcoin positions, as the investment team was able to rotate into Solana and other big gainers in 2021 before price exploded higher. However, the majority of absolute returns still came from the large Bitcoin and Ethereum exposures.
Comparisons to Grayscale and Cryptocurrency Investment Landscape
With $100 million+ in AUM, Rex Fund is still tiny compared to the likes of Grayscale, which has over $20 billion invested solely in its Bitcoin Trust product (GBTC). However, Rex is representative of the growing number of active crypto hedge funds and venture capital firms managing outside capital.
These institutional investors help drive maturation in the traditionally retail-dominated cryptocurrency markets. Their steady accumulation of Bitcoin and altcoin positions (often referred to as “smart money”) may lead to price discovery and reduced volatility over time. If the current pace of adoption continues, total institutional AUM in digital assets could reach into the hundreds of billions or more within the next 5 years.
In conclusion, Rex Investment Fund is a rising cryptocurrency asset manager utilizing active investment strategies to outperform passive benchmark indexes. Its concentrated bets on high growth coins and networks like Solana have led to impressive historical returns. As institutional demand for crypto exposure accelerates, firms like Rex Fund stand to continue benefiting through superior coin selection and timely trading.