Treasury Selic, cryptoactive funds and stock exchange and suffer negative impact

September was not a positive month for crypto fund investors. But it was also a bad month for other investments such as the Selic Treasury and Ibovespa.

Treasury Selic, cryptoactive funds approved by the Securities and Exchange Commission (CVM), and the stock market suffered a strong negative impact in September.

Although the reasons for this negative impact cannot yet be determined, the month was the worst for national cryptoactive funds.

In Brazil there are two types of funds with exposure to cryptoactives. One is intended for the general public and in which a maximum of 20% is allocated in cryptomorphs.

In this case, the fall observed in September was from 1.85% to 2.35%.

The fund for professional investors, on the other hand, which can have 100% exposure to cryptomorphs, had a negative variation of 2.35% to 13%.

Cryptomoedas and Ibovespa

But September was not only bad for funds with Bitcoin Optimizer allocation, the period was also marked as the third worst month for Ibovespa shares in 2020.

The drop was -5.23%, and there was also a negative impact on the Selic Treasury – considered the most traditional public security, according to iHUB Investimentos.

„As for the stock market: In the first quarter, they occupy the first two positions with negative figures: February with -8.50% and March with -30.18%,“ comments iHUB’s founding partner, Paulo Cunha.

Treasury Selic

In September, Selic treasury papers were being traded at a discount on the secondary market for lack of buyers interested in the paper.

„Funds investing 100% in these papers had a return of 0.04% in September, compared with 0.18% in the CDI, a considerable difference,“ comments Cunha.

Another point to note is that the market points out that this distortion should be momentary, since it is natural that the papers return to the SELIC and CDI rates.

„The background to this movement is the fear of the fiscal and reform agenda with the government. The market is beginning to put the price at such a level that interest rates may no longer remain at 2% per year with SELIC for a considerable time, as was predicted in August,“ Cunha adds.

Treasury Selic or Bitcoin

According to Cunha, despite the September results, the Selic Treasury is considered a natural emergency reserve.

Thus, for him, the title has a very low risk of default and also of showing a negative return on a monthly basis.

In addition, Cunha points out that he has high liquidity to be able to recover the values, within one day, if he needs the money.

„September was an unusual month, as it showed contradiction about the benefits of the Treasury Selic, due to the threat of the scenario of strong risk aversion and concerns about government accounts,“ he explains. For the portfolio, it is generally recommended between 5% and 30% of investment in this type of application, adds Cunha.

For the former vice-president of JPMorgan in Switzerland, Andrey Nousi, Bitcoin is this safe haven in times of market uncertainty.

„The advance of cryptomorphs is notorious. It went through a bubble in 2017 and 2018 and is now much better, once that irrational euphoria has passed. And now it is being much more accepted even by big players,“ notes Nousi.

The former vice-president of JPMorgam added that Bitcoin is one of the options to preserve the value of money, as well as gold and the dollar.

„When you no longer want to be exposed to Risco Brasil, you send your money out. Now, what will you do with that money? There are a lot of opportunities, like gold, dollar and bitcoin,“ he said.