Leverage Shares, a leading issuer of ETFs, has expanded its portfolio with the launch of two new leveraged and inverse MicroStrategy ETFs on the London Stock Exchange (LSE). This launch introduces the first-ever physically-backed 3x leveraged and -3x inverse ETPs tied to MSTR shares. Moreover, the MSTR stock soared nearly 9% after the announcement today.
New 3x MicroStrategy ETFs in London
The two new ETPs are Leverage Shares 3x Long MicroStrategy (MST3) and Leverage Shares -3x Short MicroStrategy (MSTS). These products allow investors to either amplify their exposure to MicroStrategy’s stock or profit from potential declines. MicroStrategy, a business intelligence software company, has become closely linked with Bitcoin investment, with much of its stock price movement driven by crypto market fluctuations.
Hence, the ETPs are designed to provide a high-leverage option for traders who want to take advantage of this volatility. Oktay Kavrak, Director of Strategy and Communications at Leverage Shares, commented on the launch, saying:
“With MicroStrategy becoming a de facto proxy for Bitcoin investing, our MSTR ETPs enable traders to leverage their cryptocurrency outlook efficiently. Whether to boost returns or protect against market swings, investors can now position themselves accordingly through a highly liquid and centrally cleared product.”
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The 3x leveraged MicroStrategy ETF allows traders to triple their exposure to the stock, amplifying both gains and losses. Whilst the -3x inverse ETP lets investors profit from declines in MicroStrategy stock price. Both products are physically-backed, meaning they hold the underlying asset, making them a unique offering on the market. These products track the performance of the Euronext 3x Long and -3x Short MicroStrategy indices.
Analyst Remark and Market Reaction
In response to the launch, Bloomberg Senior ETF analyst Eric Balchunas commented on X, “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.” His remark underscores the high-risk, high-reward nature of these products, which offer significant volatility and require careful handling by investors.
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
Leverage Shares now offers a total of 162 ETPs, solidifying its position as one of the leading ETP issuers in the UK and Europe. With over $1 billion in assets under management, the company continues to expand its product line to meet investor preferences.
Following the announcement, MSTR stock soared by 8.94% to $165.52 at press time during the market trading session Thursday, September 26. In addition, the stock’s gain the last five days increased to 14.67%.
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