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Leverage Shares has launched the first leveraged and inverse exchange-traded product tied to the performance of MicroStrategy stock.
These new investment products, now available on the London Stock Exchange, include the 3x Long MicroStrategy exchange-traded product (ticker symbol ‘$MST3’) and the 3x Short MicroStrategy exchange-traded product (ticker symbol ‘$MSTS’).
For investors unfamiliar with ETPs, they are financial instruments that track the performance of an asset, such as stocks — in this case, MicroStrategy’s stock.
The 3x long exchange-traded product allows investors to triple the gains (or losses) of MicroStrategy’s stock, while the -3x short exchange-traded product lets investors profit if the stock’s value falls, with triple leverage.
LeverageShares launching new 3x Microstrategy ETFs in Europe (who aren’t likely to appreciate the unbridled adrenaline being packaged here like Americans do). These things will be around 18-20x the volatility of SPX. They will make 3x QQQ look like money mkt fund pic.twitter.com/DYM4x2O7l9
— Eric Balchunas (@EricBalchunas) September 26, 2024
Microstrategy is known for its extensive Bitcoin (BTC) holdings. On Sept. 20, MicroStrategy announced it had purchased an additional 7,420 Bitcoin for over $458 million at an average price of $61,750 per Bitcoin. The company also reported a total Bitcoin yield of 5.1% quarter-to-date and 17.8% year-to-date.
As of Sept. 20, their total holdings reached 252,220 Bitcoin.
Indirect Bitcoin trading
This move by Leverage Shares offers investors a way to leverage their outlook on Bitcoin indirectly by investing in these exchange-traded products tied to MicroStrategy’s performance. According to Leverage Shares’ Director of Strategy and Communications, Oktay Kavrak, this launch allows traders to “leverage their cryptocurrency outlook efficiently,” either to amplify potential returns or to hedge against market volatility, as noted in the company’s social media post.
Euronext, a European stock exchange group, provides the benchmark indices for these products.
These exchange-traded products introduce a new way for European investors to access the highly volatile world of cryptocurrency-related investments, with leverage that could be 18-20 times more volatile than standard market indexes like the S&P 500.