Crypto - MSTY

robertc400

robertc400

Well-Known Member
Silver Stacker
Hi Fellow Stackers,
I am a newbie when it comes to crypto.
Only recently bought a little XRP and Solana.
Can anyone explain this MSTY concept - a dividend every month - Wow.
How does it work?
Any downfalls?
If the stock drops 50% but you receive a 100% dividend over the timeframe of a year you are still in front.
Is there a catch?
Any help would be great.
 
I have no idea personally but here is ChatGPT to help us out;

What is the MSTY Concept in Cryptocurrency?

The YieldMax™ MSTR Option Income Strategy ETF (MSTY) is an actively managed exchange-traded fund (ETF) designed to generate monthly income by employing a covered call strategy on MicroStrategy Incorporated (MSTR) stock. This fund is particularly relevant due to MicroStrategy’s substantial holdings in Bitcoin.

Key Features of MSTY
  1. Income Generation
    MSTY generates monthly income by selling (writing) call options on MSTR stock.

  2. Exposure to MicroStrategy
    Investors gain indirect exposure to the performance of MicroStrategy (MSTR), a company with significant Bitcoin holdings.

  3. Capped Upside Potential
    • The covered call strategy limits the potential gains if MSTR’s stock price increases significantly.
    • On the downside, MSTY remains exposed to potential losses if MSTR’s stock price declines.
Considerations for Investors
  • Risk Factors
    • Single Issuer Risk: MSTY focuses solely on MSTR, increasing risk.
    • Capped Gains: The strategy limits profits from MSTR price surges.
    • Downside Exposure: Losses remain if MSTR’s stock price falls.
  • Not a Direct Investment in Bitcoin
    While MicroStrategy holds substantial Bitcoin assets, MSTY itself does not directly invest in Bitcoin or other digital assets.
Who Should Consider MSTY?
MSTY may appeal to income-focused investors who want exposure to MicroStrategy and its Bitcoin-related potential, but it is not suitable for those looking for uncapped upside or direct cryptocurrency investments.

Sources:
YieldMax™ Official Page
Barron’s Article
GlobeNewswire Article
Click to expand...
 
Yea if you reinvest 100% imagine the gains over a 10year period.
$10K goes to 20 and then 40 , then 80 and so on. The mind boggles if you start with 50 or 100k
 
robertc400 said:
^^^ Gee I hope not.
Click to expand...

Highly unlikely during a BTC bull run, particularly over the time period he presents.

I think going forward that the plan will be for MSTR to eliminate it's shorter term debt obligations, this should go a long way in shielding the share price from a collapse when a BTC bear market eventuates.
 
1Tim58 said:
I have no idea personally but here is ChatGPT to help us out;
Click to expand...
Deepseek now ;) China has thrown together their Ai with cheap chips and rubber bands haha i hope it drops Nvidia like a stone its pumped to hell if china can reproduce similiar aspects at lower cost so be it...we need competition and fair pricing, we need it here too our monopolies are ruining us
 
Yea down heaps - Getting distributions, but not offsetting the price drop.
Wasn't too bad until spill from JPM trying to get rid of MSTR.
Besides silver I have 50% of my saving in MSTR & MSTY.
Not looking good, especially if Jan the 15th thing happens.
They could both go to zero.
Will have to wait and see.
 
robertc400 said:
Yea down heaps - Getting distributions, but not offsetting the price drop.
Wasn't too bad until spill from JPM trying to get rid of MSTR.
Besides silver I have 50% of my saving in MSTR & MSTY.
Not looking good, especially if Jan the 15th thing happens.
They could both go to zero.
Will have to wait and see.
Click to expand...
You have gold too mate, that should cushion things just in case others go to shit. Heres hoping for good outcome but
 
I doubt it too as they still own the bitcoin.
And the Jan 15th ruling does not effect bitcoin.
MSTR might go down a lot, but should recover alongside the price of bitcoin I would have thought.
Thats what I am hoping for even if the ruling goes against them.
Will have to wait and see.
Despite the fact that I bought my first crypto in January (and down heaps) I am also one of those long term holders, so that helps.
But gee, riding the roller coaster ride on the way down is much better in real life.
So I haven't been on the roller coaster on the way up yet, looking forward to that :)
Might have to wait 5 or 10 years but thats ok.
 
My concern is what happens when Bitcoin drops below MSTR’s average purchase price - which will happen at some point, some point soon too I'd imagine.

It’s always been a significant risk to take on leverage in an already highly speculative asset class. I’ve mentioned this in this thread (or another) before, but in my view - and so far this has played out - Bitcoin has reversed long-term relative to gold.

DYOR, but personally I’d be steering clear of this asset class moving forward.
 
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