MSTU And MSTZ: The Only 2x ETFs On MicroStrategy And One Of The Most Volatile Ways To Play Bitcoin
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October 14, 2024 09:05 AM Eastern Daylight Time
By Gerelyn Terzo, Benzinga
As the Bitcoin price dances in the $60,000s, investors are reminded of an effectively inherent element – volatility. Now that Bitcoin has become mainstream, investors and traders have more ways than ever to gain exposure to this digital currency. They are no longer limited to buying and holding in dedicated crypto wallets or exchanges, thanks to a combination of regulatory tailwinds and tech innovation that has opened up the world of crypto directly within brokerage accounts.
While many people are focusing on Spot Bitcoin ETFs, one of the most interesting ways to capitalize on this opportunity includes listed companies that are piling Bitcoin onto their balance sheets, such as MicroStrategy (NASDAQ: MSTR).
The company's strategic decision to invest heavily in Bitcoin ties its stock performance closely to the digital currency's price swings. As a result, trading in MicroStrategy shares effectively becomes a play on Bitcoin's infamous volatility. This has particularly appealed to traders who seek exposure to Bitcoin's potential upsides and inherent risks, while also leveraging the liquidity and regulatory framework of a NASDAQ-listed stock. MicroStrategy's own implied volatility is a potentially attractive feature for those looking to benefit from rapid price changes in the crypto market, magnified by the company's significant Bitcoin holdings. With an average daily trading volume of 11 million shares in September, MicroStrategy stock offers no shortage of opportunities.
And now one way to play MicroStrategy with leverage is through a pair of ETFs launched by REX Shares — which recently surpassed $5 billion in assets under management — alongside ETF provider Tuttle Capital Management. Now, REX Shares and Tuttle Capital have launched the industry’s only 2x/-2x ETFs for MicroStrategy - T-REX 2X Long MSTR Daily Target ETF (BATS: MSTU) and T-REX 2X Inverse MSTR Daily Target ETF (BATS: MSTZ).
REX’s ETFs are the first of their kind to offer +200% and -200% exposure to MicroStrategy, reports REX Shares, potentially paving the way for traders who closely monitor MSTR stock movements to harness fresh possibilities.
Each of REX’s latest products gives investors a way to play both sides of the coin. For example, the T-REX 2X Long MSTR Daily Target ETF was created for traders who are bullish on MSTR shares, delivering the potential to amplify gains with +200% exposure to the stock’s daily movements. On the flip side, the T-REX 2X Inverse MSTR Daily Target ETF offers 200% inverse exposure to MSTR, offering traders who are bearish on MicroStrategy’s stock price to bet on its decline.
With the options market now open, investors can take their trading strategies a step further by utilizing options to fine-tune their positions, hedge risk or capitalize on market volatility, said REX Shares. With the opportunities that options trading can provide, coupled with ETFs and Bitcoin, investors have no shortage of ways to play this dynamic market that is ripe with volatility.
To explore REX’s approach to trading, check out its product offerings here.
REX’s ETF Appeals To Bulls And Bears
Options give traders the opportunity to purchase contracts that give them the right to buy or sell an asset, like a stock or cryptocurrency, for a pre-set price over a specified term. Options trading has taken hold in the Bitcoin market, where monthly expiry amounts on BTC contracts have been ranging from $8 billion to $14 billion since the flagship cryptocurrency’s most recent halving event.
After recently introducing the first and only 2x leveraged MSTR ETFs to the market, REX Shares says it will continue to innovate, essentially giving sophisticated traders a chance to place leveraged wagers on Bitcoin, of which MicroStrategy owns over $9 billion worth, as of September. Given MicroStrategy’s commitment to owning Bitcoin, its stock is often as volatile as the cryptocurrency itself.
Investors should be aware that trading these funds is not the same as investing directly into Bitcoin or MicroStrategy, commanding a heightened level of portfolio management. You can learn more about these ETFs as well as other trading products that REX Shares has to offer here.
Featured photo by Tyler Prahm on Unsplash
Benzinga is a leading financial media and data provider, known for delivering accurate, timely, and actionable financial information to empower investors and traders.
This post contains sponsored content. This content is for informational purposes only and is not intended to be investing advice.
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