T-Rex Group has submitted applications for exchange-traded funds (ETFs) that are designed to track the daily performance of Microstrategy Incorporated (MSTR) with. proposed ETFs will take 2x long and 2x inverse positions in MSTR amplifying its daily stock performance by 200%.
T-Rex Group Seeks Approval for Microstrategy ETFs, Branded as the ‘Ghost Pepper of ETF Hot Sauce’
T-Rex Group, a provider of exchange-traded funds (ETFs), has documents with the U.S. Securities and Exchange Commission (SEC) to introduce twos focused on Microstrategy (Nasdaq: MSTR), a company recognized for substantial bitcoin (BTC) holdings. The T-Rex 2X Long MSTR Daily ETF aims to achieve 200% of Microstrategy’s daily performance, while the-Rex 2X Inverse MSTR Daily Target ETF will target a 2x performance of MSTR.
These ETFs are specifically crafted to magnify the everyday fluctuations in MSTR, which is heavily impacted bitcoin’s price movements. MicroStrategy, spearheaded by CEO Michael Saylor, has drawn attention due to its aggressive accumulation of bitcoin holds an impressive total of 226,331 BTC on its balance sheet. As per proposal, the implied volatility associated withSTR stock presents both high-risk and high-reward opportunities for investors.
“T-Rex just made an inaugural filing for their new of 2x Microstrategy MSTR ETFs... these are anticipated to be some the most volatile ever seen within U.S., likely around twenty times more volatile than SPX,” remarked Eric Balch from Bloomberg. “The ghost pepper of ETF hot sauce,” added as an analogy.
The risk section in the filing acknowledges that both T-Rex 2X Long MSTR Daily Target ETF and its inverse counterpart may not be suitable for investors. Such funds necessitate active portfolio management and a sophisticated comprehension of leveraged strategies.
These specialized investment tools are intended primarily for short-term trading purposes and are projected to undergo frequent portfolio adjustments owing to daily rebalancing practices. The SEC filing meticulously outlines significant risks involved with these investments including potential losses MSTR’s performance remains stagnant or experiences notable volatility.
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