Does a Bitcoin fund actually track Bitcoin?

A fund named after an asset ought to move with that asset. Whether it does is not a matter of opinion or trust — it is measurable from data both sides publish. Here is how we test it on the fund dashboards, and how you can run the same check on anything you hold.

The question, stated precisely

If a fund holds Bitcoin and reports its NAV in ringgit, then day to day:

fund NAV (MYR) should move like BTC price (USD) × USD/MYR exchange rate

So you build two daily series — the fund's published NAV per unit, and Bitcoin priced in ringgit — and compare their daily percentage changes.

The detail that breaks most analyses: timestamps

This is the single most important thing on this page.

A fund strikes its NAV at a specific time each business day. If you compare that NAV against a Bitcoin price taken at a different time — midnight UTC, say, or the daily close of some exchange — you are comparing two different moments. The mismatch shows up as an apparent lag: today's NAV looks like it is following yesterday's Bitcoin price.

That lag is an artefact of your own data handling. It is not evidence that the fund is slow, stale, or mispricing anything.

The same applies to the currency leg, and it is the part people forget. If the fund values at 5pm local time, you need the exchange rate at 5pm — not the previous day's central bank reference rate, not a daily average. Using a same-time interbank rate is what makes the relationship snap into focus.

Align all three inputs — NAV time, asset price time, FX time — to the same moment on the same day. Do that and the analysis becomes straightforward. Skip it and you will "discover" lags and tracking errors that do not exist.

The three numbers worth computing

Beta — if the asset moves 1%, how much does the fund move? A pure tracker should sit very close to 1.00. Materially below 1 means the fund is not fully exposed; above 1 means leverage or something else in the portfolio.

R² — how much of the fund's movement is explained by the asset's movement, on a 0 to 1 scale. A tracker should be extremely close to 1. A lower R² means something else is driving the fund, which is the more interesting finding.

Tracking error — the typical size of the daily difference between the two, expressed as a percentage. Small and stable is what you want; the number itself only means something relative to the asset's own volatility.

Beta and R² answer different questions, and you need both. A fund can have a beta near 1 and a poor R² — moving the right amount on average but not at the right times.

Fees show up as a slow drift, not a gap

Divide the fund's NAV by the asset price and plot the ratio over time. For a tracker, that line should be almost flat.

Almost. A management fee accrues daily and comes out of NAV, so the ratio drifts gently downward — and the annualised slope of that drift should be close to the stated fee. When it lands near the published rate, that is a good sign: the fee is doing exactly what the documents say and nothing else is silently leaking.

Sometimes the drift comes out smaller than the fee, or even positive. That means the fund is earning something the raw asset price does not capture — staking rewards on a proof-of-stake asset, for example — partly or fully offsetting the fee. That is worth understanding rather than assuming an error.

Not every fund is supposed to track

This is where the test has to stop and think.

A defensive or risk-managed strategy holds an asset but deliberately reduces exposure — moving to cash in drawdowns, hedging, or sizing down. Measuring it as a tracker and reporting a low beta as a failure completely misreads the product. The right test for that fund is different: how much of the asset's upside did it capture, and how much of its drawdown did it avoid? A fund whose maximum drawdown is a small fraction of the underlying asset's, while capturing a modest share of the rise, is doing precisely what a capital-preservation mandate asks of it.

Likewise a basket fund holding several assets should not track any one of them. There the useful measures are its own NAV performance and drawdown from peak, not a correlation to a single coin.

Match the test to the mandate. Applying a tracker's yardstick to a defensive fund produces a number that is accurate and completely meaningless.

What we publish

Each of the four fund dashboards runs this analysis daily against public data — the manager's published NAV, exchange price data, and a same-time interbank exchange rate — and shows the workings rather than just a conclusion:

• Bitcoin Fund — NAV against Bitcoin, plus fund size and daily net flows in BTC
• Ethereum Fund — same method, and a different fee-drift result worth reading
• Defensive Bitcoin — measured as capital preservation, not as a tracker
• Crypto Titans — NAV performance and drawdown for a basket

The point of publishing the method alongside the numbers is that you should not have to take our word for any of it. Every input is public. Run it yourself.