ETFs
T-Rex Group files for a 2x long inverse microstrategy ETF
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T-Rex Group has filed an application for new ETFs taking a leveraged long or short position in Microstrategy (MSTR).
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MSTR is known for its volatility given its high exposure to bitcoin.
Exchange-traded fund (ETF) issuer T-Rex Group has filed for an ETF that will take a 2x long position in bitcoin {{BTC}}-rich Microstrategy (MSTR).
According to a file published on the Securities and Exchange website Foreign Exchange Commission EDGAR PlatformThe T-Rex 2X Long MSTR Daily Target ETF aims to achieve 200% of MicroStrategy’s daily performance.
T-Rex also filed an ETF that would take a 2x inverse position in MSTR. In effect, both of these listed products would constitute long or short leverage on Bitcoin.
MSTR, with its heavy exposure to bitcoin, is known for its volatility as it tracks the world’s largest digital asset. Current implied volatility is high at 85.6but with a trend lower than its recent average, as the price of bitcoin remains stable.
Recently, its CEO, Michael Saylor, announced the company would offer $500 million in convertible notes to increase its bitcoin holdings.
Bloomberg ETF analyst Eric Balchunas wrote on X that these ETFs would be “almost guaranteed to be the most volatile ETFs ever seen in the U.S., with volatility 20 times that of the SPX.”
T-Rex just filed a request for the first ever 2x Microstrategy $MSTR The ETFs…they’re almost sure to be the most volatile ETFs ever seen in the US, they’ll probably be on the order of 20 times the volatility of the SPX. The ghost pepper of ETF hot sauce. pic.twitter.com/NlUQMVToxI
– Eric Balchunas (@EricBalchunas) June 27, 2024
They will be the “ghost pepper in ETF hot sauce,” he said.
ETF Issuers Challenge And Granite Actions have also listed products that take a short position on MSTR.
T-Rex also filed six leveraged inverse Bitcoin ETFs in Marchwith positions ranging from 1.5x to 2x.