The SEC has just given the green light to a high-stakes first MicroStrategy leveraged ETF, MSTX, that’s set to shake up the market. The Defiance Daily Target 1.75X Long MSTR ETF—a fund designed to amplify returns.
This ETF doesn’t just track MicroStrategy (MSTR), it magnifies its daily moves by 1.75 times. MSTX, a leveraged ETF, is issued by Defiance ETFs. It provides amplified exposure to Bitcoin through MicroStrategy, one of the largest corporate holders of Bitcoin. Defiance CEO Sylvia Jablonski highlighted that the ETF aligns with the company’s focus on thematic and leveraged investment products.
Well, with MicroStrategy’s annualized historical volatility at a dizzying 84.19% over the past five years, this new ETF is primed to be the most volatile in the U.S. market, according to Eric Balchunas, Bloomberg Intelligence’s ETF analyst. That’s a lot of ups and downs packed into one fund.
Eric further said, “While $MSTX will be most volatile in US it can’t hold a candle to $3LMI LN in Europe, which is 3x Microstrategy, it’s 90D volatility is over 350%, makes $TQQQ look like a money market fund. One of the craziest charts in ETF Land.”
A 1.29% management fee is attached to this high-risk venture. But for those with a taste for high-octane financial adventures, the Defiance Daily Target 1.75X Long MSTR ETF offers a chance to chase larger, albeit riskier, returns.
MicroStrategy, led by its crypto-enthusiast founder Michael Saylor, is a tech company with a penchant for buying Bitcoin using convertible debt.
Also Read: “We will not be launching crypto ETFs” — Vanguard Group CEO
