A short time ago, @jongolson announced the launch of the Hive Engine Index Token. You can find all the details here. I really like the concept, and there is a few Hive Engine investments that I have missed the boat on so I decided that this was one I wanted to buy in to. So much so, that I sacrificed funds in the form of LEO that I had earmarked for LBI to do it.
Diversifying income streams.
The basic idea of INDEX is that the fund will hold a selection of HE tokens, backing the value of the INDEX token itself in a similar manner to LBI. Whereas SPI and the upcoming LBI are focusing on one asset, and then building diversification within the fund from there, this is starting out from day 1 as diversified. Backing different approaches makes sense, and having taken a look at the assets this fund will hold, I decided to jump in.
My favorite part is that this will pay out a daily dividend, which will be 80% of its daily income. That is pretty cool, and I look forward to another source of income flowing in to my account, growing over time. Some of the assets the fund will hold are not really income producing assets, so I'm not expecting a huge daily dividend, but any passive income is good income in my eye's.
The thing I really like about these types of investments is that as an investor, we can grow and back other people's judgement and skills, and diversify beyond our personal capabilities. In this case, I think you would be hard pressed to find a more passionate person around HIVE than @jongolson, and with @blainjones as his offsider, there is a whole range of HIVE knowledge and skills that I don't have. Backing this project means I can back their skills, and benefit from them. A 10% service fee is a very small price to pay for having some one else build your assets up for you.
Taking a look at the investments.
I like that INDEX has a webpage, set up from day 1. There you can see what tokens the fund will be holding, and the proportion of each.
LEO - an obvious choice, close to 40% allocation. I think from the daily income side, this will contribute the Lion's share (pun intended) of the dividends. We all know the potential of LEO... enough said.
DEC - very close to LEO in allocation. No income stream that I am aware of for this asset, and I'm unsure of its worth as a buy hold investment. I see it as a utility token personally, but as part of an index of the strongest HE tokens it deserves its place at the table.
SIM - 16%. Another utility token, it has had a small income flow added to the mix for hodlers. Limited capital gains chance, with it seemingly determined to hold a solid peg around 0.005 HIVE, but another one that deserves its place.
BLURT - I'm happy this is included, as I sold all my BLURT and this means I'll have a little exposure to any potential upside. 3% allocation, so it's not really going to drive the fund in a big way, but nice to have a little in the mix.
BEE, STEM, BRO, PAL, SPI, ARCHON are the remaining tokens in the fund. Ranging from being tokens I really like, through to some I have little interest in, these make up a small proportion of the fund only and will not make a significant contribution to the dividends.
Overall, it is not hard to see that the dividends will be primarily based on LEO. If the allocations of assets change over time, this could alter, but for now with those proportions, the fund will hold a bunch of tokens and pay mainly LEO dividends. I'm ok with that, but I'd like a slightly higher allocation to alternative income assets.
3000 so far.
So I picked up 3000 of these INDEX tokens, to back the concept and see how it goes. My plan is to monitor it for a while now, and see how the project settles in for the long haul after the initial launch phase. LBI launch coming soon will be a big focus of mine, but adding INDEX to my holdings makes sense. I'll be interested to follow the progress, and congratulate @jongolson and @blainjones on the launch. As always, do your own research, and any opinions expressed are just my personal thoughts and not financial advice.
Cheers,
JK.
