Joseph Barrato, CEO of Arrow Investment Advisors, LLC, joined Keith Black, Managing Director of RIA Channel, to discuss tactical allocations across bitcoin, gold, and cash.
Barrato notes that advisors are curious about bitcoin, but are not yet comfortable with the volatility. Barrato believes that bitcoin belongs in portfolios and not on watch lists.
Arrow has launched the Arrow Valtoro ETF (ORO), which invests in bitcoin in a rules-based tactical framework designed to reduce volatility. The goal is to capture a substantial portion of the upside returns to bitcoin while reducing the downside risk. The tactical bitcoin index methodology reallocates daily between bitcoin, gold, and cash based on macro and trend indicators. The fund deploys three models: one to rotate between bitcoin and gold, a bitcoin risk model to decide when to move to cash, and a tactical gold model to decide on allocations vs cash. The results of the three models are blended to build portfolio allocations that are designed to sidestep the maximum drawdown periods of bitcoin.
From its November 2021 launch until the end of September 2024, the tactical bitcoin index earned returns slightly higher than a buy-and-hold bitcoin allocation with half of the volatility and drawdown risk, capturing a greater portion of the upside returns than the downside returns.
The ORO ETF is built like an institutional-grade ETF that trades regulated gold and bitcoin futures contracts and is compliant with a registered investment company framework. Investors can hold the ORO ETF without a bitcoin wallet or a futures trading account. The short-term Treasury holdings in the fund can earn a substantial collateral yield, as interest rates are much higher today than at the launch of the fund. The Treasury yield is added to the returns from the tactical allocations to gold and bitcoin futures contracts.
Advisors can allocate 3% to 5% of model portfolios to the tactical bitcoin strategy without an increase in expected portfolio volatility, as it has a low correlation to both bonds and equities. Adding a volatile asset to a portfolio might not increase portfolio volatility if the weight on the asset and return correlations to other assets are relatively low.
Barrato has been building tactical models for over 20 years, working with legendary managed futures funds and traders. The innovations aim to transform volatility into opportunity.
| WEBCAST – Taming the Bitcoin Cycle: How the Arrow Valtoro ETF Brings Institutional Structure to Crypto Exposure
Bitcoin’s growth story is undeniable — but so are its 70% drawdowns, wild volatility, and recovery math few clients can stomach. Advisors today are being asked to deliver Bitcoin exposure without the chaos.
The Arrow Valtoro ETF (Ticker: ORO) was built to do exactly that. ORO tracks the AI Tactical Bitcoin Index (AITBCS) — a live, rules-based benchmark published daily on Bloomberg since 2021 — that dynamically reallocates between Bitcoin, gold, and cash to capture upside while controlling risk.
Since its inception (November 2021 – September 2025), the Tactical Bitcoin benchmark has produced a 20.6% annualized return, with less than half of Bitcoin’s drawdown (–32% vs –70%) and roughly half its volatility (25.6% vs 52.0%). It has captured 42% of Bitcoin’s upside while limiting downside to only 35%, all with a low correlation of 0.1 to equities, making it a compelling alternative sleeve within diversified portfolios.
Join this webcast to learn:
- Why advisor demand for Bitcoin exposure is accelerating — and how it fits within 60/40 and alternatives frameworks.
- How the AITBCS Index uses daily macro and momentum signals to shift between Bitcoin, gold, and cash.
- Why avoiding deep drawdowns is key to faster recovery and long-term compounding.
- How ORO’s institutional structure helps bridge digital assets and traditional allocation discipline.
Accepted for 1 CFP® / IWI / CFA CE Credit