MSTX, the first leveraged exchange-traded fund (ETF) designed for MicroStrategy’s shares, attracted attention with record entries on the opening day. MSTX provides exposure to 1.75x the daily return on MicroStrategy shares.
Leveraged Funds Rise in 2024 ETF Rankings
The 2x leveraged ETF called MSTU, launched a month later, reached $72 million in assets under management within a week. Both ETFs have strong liquidity, with MSTX currently in the top 8 percent in assets under management among ETFs in 2024, reaching $357 million.
Bitcoin Tested the $60 Thousand Level
MSTU, on the other hand, achieved a transaction volume of $40 million on an important trading day the other day, entering the top 1 percent among 2024 launches and exceeding $100 million in assets under management.
Bloomberg’s Senior ETF Analyst Eric Balchunas noted that the initial performance of MSTX and MSTU was beyond his expectations. MSTU’s rapid growth indicates that investor interest in such leveraged products is high.
This would make sense if there were no leveraged MSTR ETF (MSTX) already in the market with available liquidity, but that is not the case. This exceeds the ETF’s laws of physics and suggests that issuers will continue to push the volatility limit.
On the other hand, the cryptocurrency behind all these developments is Bitcoin. 
$60,521is having difficulty maintaining its momentum. Although it increased by 122 percent during the year, it gained only 3 percent in value in the last month.
After hitting a local high of $66,367 on September 28, Bitcoin has fallen nearly 10 percent and is currently trading around $61,000.
MSTU’s $40 million volume on the last trading day moved the fund into the top 1 percent. This rapid growth reflects investors’ interest in leveraged products in anticipation of high returns.
While the popularity of such financial instruments is increasing in the ETF market, factors such as liquidity and volatility significantly affect investor decisions. Despite the potentially higher returns offered by leveraged ETFs, investors need to consider their risks carefully.
The success of leveraged ETFs shows that there is continued demand for such products in the market and investors are seeking higher returns in volatile markets. However, it is important to remember that these funds carry as much risk as their potential to provide returns.
Finally, it may be beneficial for investors to conduct thorough research and consider their risk tolerance before investing in such leveraged products. In this way, they can make more informed investment decisions by being aware of potential returns as well as possible losses.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
