T-Rex Group ETF Filing Overview
T-Rex Group, a well-known ETF issuer, has recently filed for a new Exchange-Traded Fund (ETF) that is designed to take a 2x long position in MicroStrategy (MSTR), a company heavily invested in bitcoin (BTC). The new ETF, named T-Rex 2X Long MSTR Daily Target ETF, aims to deliver 200% of MicroStrategy’s daily performance.
MicroStrategy, due to its significant exposure to bitcoin, is known for its inherent volatility as it closely follows the price movements of the largest digital asset in the world. The stock’s current implied volatility stands at 85.6, although it has been trending lower recently as bitcoin’s price stabilizes.
In a recent announcement, MicroStrategy’s CEO, Michael Saylor, revealed plans for the company to offer $500 million in convertible notes to further increase its bitcoin holdings, emphasizing its commitment to the cryptocurrency.
Notably, T-Rex has also filed for an ETF that will take a 2x inverted position in MicroStrategy (MSTR). These ETFs essentially offer leveraged long or short exposure to bitcoin through MicroStrategy’s performance, making them products of interest to investors seeking amplified returns in the volatile cryptocurrency market.
Bloomberg ETF analyst Eric Balchunas described these upcoming ETFs as potentially the most volatile ever seen in the U.S. market, projecting them to exhibit 20 times the volatility of the S&P 500 index. He likened them to the ‘ghost pepper of ETF hot sauce,’ highlighting the extreme volatility they are expected to bring.
In addition to T-Rex’s filings, other ETF issuers such as Defiance and GraniteShares have also introduced products that take a short position in MicroStrategy (MSTR), catering to investors looking to capitalize on potential downward movements in the company’s stock.
Furthermore, T-Rex previously filed for six leveraged inverse bitcoin ETFs in March, featuring positions ranging from 1.5x to 2x. These filings demonstrate the growing interest among ETF issuers in providing innovative products that allow investors to gain exposure to the dynamic cryptocurrency market through different strategies and risk profiles.