I bought a trampoline. Got a squat machine. BlackRock filed for a Bitcoin fund with capped gains.

The report

In full

I bought a trampoline. Got a squat machine.

BlackRock's iShares Trust filed on October 19 for the iShares Bitcoin Managed Protection ETF, proposed ticker PBIT. An ETF is a fund whose shares trade on an exchange.

PBIT is not yet approved or trading. It would aim to limit losses while giving up gains above a ceiling.

The proposed design uses options: contracts that give the buyer a right to buy or sell an asset on agreed terms. Here, the contracts are linked to IBIT, BlackRock's existing iShares Bitcoin Trust ETF, or similar Bitcoin exposure.

Buying some contracts and selling others helps pay for the intended protection, but surrenders gains above an agreed level. Reporting describes cash and short-term fixed-income holdings alongside the options, usually arranged in 3 overlapping batches.

For each batch, the filing describes typical initial maximum loss exposure of about 10% before fees and expenses. That does not mean the fund absorbs the first 10% lost.

Terms differ between batches and change over time; a buyer does not receive one fixed loss limit. The maximum gain also varies, with no single cap announced.

The intended benefit is a different balance between possible gains and losses. Protection is not guaranteed: investors could lose some or all of the money invested.

The filing leaves fees and a launch date undisclosed.

I asked my new trampoline for more headroom. It offered me a shorter trampoline.