저자: Kevin · 외국인
요약 보기
MSTY ETF의 높은 분배율(약 90.8%)은 옵션 프리미엄을 연환산한 수치라 지속가능하지 않다고 주장. 보유 풋옵션(약 8억 달러)과 매수 콜옵션 다수가 손실 상태이며 SEC 30일 수익률은 옵션 수입을 제외함. MSTR 프리미엄 하락과 비트코인-MSTR 괴리를 근거로 하락 위험을 경고하고 MSTY를 폰지/오도 가능성 상품으로 평가.
다듬은 글
We may have just discovered a massive scam in the crypto ETF world. And this has to do with understanding the difference between a distribution rate, a Bitcoin related ETF. Now, this gets complicated, but if this is actually what's going on, which we think it is, I think the company that's putting this together could be subject to a multibillion dollar lawsuit when all of this ends up going hoopy dupy.
Right now, off of just this one ETF, which has approximately $4.83 83 billion under management. The company takes a 99 basis point fee, meaning the company earns from this ETF, from what could be a pretty nasty scam and a fraudulent advertisement in my opinion, is raking in nearly $50 million a year in fees.
But they better put some of that $50 million aside if what's going on really is shady, shady, shady. Let's take a look at this as a lot of people we know aren't going to understand what's actually going on here. It's ticker MSTY. Now, here is basically an ETF that promises to pay you dividends by selling options on an underlying stock.
In this case, MSTY sells options, puts, and calls on an underlying equity known as strategy, MSTR, and we're all familiar with that. The fund doesn't actually buy MSTR directly. Instead, what the fund does is they hold cash and options. Now what's really interesting about their cash and options and this is sort of the first thing that bugs me is when we go over here to distribution details uh we could see sort of a history of distributions which is nice but not very useful because we mostly want to know what's going on now.
What do we think our next distributions are going to be? That's the most important part. The next distributions. The other thing that and and this is the the little sussy part or that starts getting you know that started intriguing my interest thinking okay what's going on here actually when we actually jump into the top 10 holdings we see cash great we got a $1.3 billion in cash that's fantastic we've got a billion dollars in treasuries for due in 2026 great short-term treasuries that's fantastic very low risk very low risk Treasuries here, a lot of cash.
That's great. Uh, and then I see call options here, but I noticed that the market value of these call options is positive. And that got me thinking because folks during my live stream in the comments are saying, "Oh, but Kevin, you know, they they sell puts and calls." Okay, but these are bought calls because the market value is listed as positive.
So, where are the sold calls and sold puts? And then I realized what they do. When you download all of the holdings, you're actually going to find that the market value of the sold options is considered negative. Therefore, their uh waiting in their fund is actually considered negative. So, you have, and I separated these out a little bit because I made some notes.
You have these sold puts, for example, that have a negative 9% weight in the fund because they're well, they're sold options, uh, that don't show up in the top 10 holdings for the company. So, even though technically the company is legally disclosing correctly that yeah, their top 10 holdings of positive value are cash and treasuries and call options that are bullish.
Micro Strategy for September 19th, for example, they have $47 million of call options at $390. They're $90 for September 19th. It's close to the Fed day here. $410 options for October 17th at $33 million. Those are bought calls. And when you go jump on over to what Micro Strategy is doing right now, it's at 340.
So we're about $50 to $70 below that price for those bot calls. That's because Micro Strategy has been on a recent downtrend. Now there is a historical precedent for this sort of downtrend happening at uh Micro Strategy while the level of Bitcoin or the valuation of Bitcoin is actually going up. Now, it's not the most bullish, but it's not a scam.
It just is what it is, right? Take a look on screen here. What do you have? Uh, you have a uh previous 2020 cycle where Bitcoin prices moved up while at the same time, Micro Strategy was trending down. Now, a downtrend on Micro Strategy is problematic because it means you're going to lose money at MST.
Why? The question is when? Because after all, the company is disclosing all these cash assets to you and they're disclosing a 90.8% distribution rate. But Captain, if I get a 90.8 distribution rate, you know, what do I care if it goes down? I'll just hold it forever. The question isn't the 90.8% distribution rate.
The question is, what is that? How long does it take you to get a 90% distribution? And who gets it? The old people in it or you? That's where there could be a smoking gun of a scam and we need to talk about it. We'll also talk a little bit about the underlying fundamentals of Micro Strategy, uh, including what's been going on with their premium.
So, we'll be talking about that. It is also worth quickly reminding you that this morning we shouted out snowflake that it could rally up towards 20%. That was our target today. It went just over 19%. A big move and we called this in the pre-market where it was nowhere near the levels it is now. And if you want to get all 10 of my stocks to buy over the next 10 years.
We're on number three right now. You get my fundamental analysis. You get trade alerts when we trade. You get the course member live streams every single day the market is open. And you only pay once. You get lifetime access to all of the courses on building your wealth. Whether it's you might you might not even need it now, like real estate or do-it-yourself property management, stock analysis, trumpics, tax benefits.
The courses themselves, by the way, could be a tax write-off. But in the future, you may go, "Oh, I really want, you know, to get into sales and watch the sales course. Oh, I want to get into renovating a property. Watch the management course." These are great tools, and you can get lifetime access by joining at meetcap.com.
Just use coupon code bullish catalyst. Yes, the coupon code is bullish catalyst. So, what's potentially going on at MSTY? And how do they come up with this distribution yield? and is it a really big scam? Well, let's first understand what's going on. So, the company has puts that they sold at 375, 395, 385, 410, and 390.
All of these are upside down. So, when they sold these options, they collected a premium. When they collected that premium, they then distributed that premium, which means that premium has already been given away. Now, they're left holding the bag on sold puts that are upside down. Basically, a sold put means they're going to have to buy $445 million of Micro Strategy at $390 unless Micro Strategy stock recovers.
If you're a landlord, you know that at the end of the day, your rental business lives and dies by the quality of your tenants and so does your stress level. Oh my gosh, don't even get me started. Okay, fortunately, our sponsor Turbo Tenant makes it easier than ever to find the right people for your rentals.
See, you can create a rental listing in minutes with Turboenant, and it automatically posts to apartments.com, Redf Fin, and dozens more, all for free. all of it for you from one place. On average with Turbo Tenant, landlords get 28 leads per listing. From there, you can run comprehensive tenant screenings, check credit, eviction history, background history.
Plus, you can verify their income so you know they can actually afford the rent based on the multiplier that you're looking for. Then you can send them a digital lease all through Turbo Tenant and they even collect rent automatically all from the same dashboard. It's free to start which is great because if you want to try the free version and see if it jives with you well it's free doesn't cost you anything.
The premium plan is 149 per year, which pretty good. And you could join 800,000 landlords already saving time and avoiding bad tenants with Turbo Tenant. Again, it's free to get started. Just click the link down below. Use the link down below, support the channel, and check out Turbo Tenant. That means they're going to have to burn a lot of the cash that they have here, and the underlying value of MSTY will probably go down.
you need MSTR to recover because they've already paid out the premium. Their hedge is the premium that they get on their options, but they've already given that a working. So, whoever buys it now is holding the bag on these options that are way upside down. But it's not just sold puts to the tune of $800 million that are upside down.
I mean, these 390s right now, 342 divided by 390, the 390s are down 12.5%. They've got $800 million of these that are upside down. Okay, this strategy works great when the market is going up. When the market is going up, fantastic. Great. You can make money. The question is how much of these premiums are they distributing because whatever they're not distributing and hopefully they're holding some for future months but the bag is growing.
Take a look at this here. You have these call options. Okay, you have sold call options. We know they're sold because you have a negative notational value here. We have sold call options at 372, 362, 37, 357, 365. Great. Those you get your premium. Fantastic. And if Micro Strategy goes down, no problem.
But look at the market values of these. We've got sold calls here of maybe $5 million, less than $5 million of sold calls here. In fact, we could just do the math on it really quickly. The sold call options that are going to be in the green are $5.9 million. The sold puts that are red are worth $800 million that are upside down.
Then we have purchased call options. So purchase call options are, you know, make money when Micro Strategy goes up. These purchased call options are $33 million at 410, 7.9 at 385. You get the idea. We're going to add this all up over here and we've got purchase call options that are upside down to the tune of $48 million.
So basically the bought calls are upside down. They barely have any sold calls and the sold puts which made them most of their option premium which they can then pay out as a distribution yield is also way upside down. Now, why then, if all this crap is so upside down, do they show a distribution rate of 90.88%.
This is because people generally don't understand how annualization works. So, I wrote it down over here. If GDP grows at 82% in a quarter, you can multiply it by four and get a GDP growth rate of about 3.3%. and that's your annualized rate. You're just taking what happened in that one quarter and multiplying it by four.
Well, in the case of MSTY, what they're doing is they're going to say, "Hey, we just sold a bunch of put options. We made, let's say, 7.5% on on our yield or on, you know, on on options premium. And we're going to distribute that. And then we're going to multiply that distribution by 12. And that's how you get to about 90.8%.
Okay. So, when they give you this distribution rate, it's actually just a 30day premium that they earned. It doesn't tell you anything about how much money they're losing after getting those options premiums. And then they're telling you that, hey, well, if we continue to get premiums like we did last month, we'll be able to pay you 90.88% 88% over the next 12 months.
So they're telling you, hey, we could if we keep doing what we did last month, we made all this premium, we'll pay you out 90.88%. This is great. This works fantastic in a bull market. But right now, people who are buying it right now are buying into a major bag. The sold puts that are upside down and the call options that they bought that are upside down.
You're buying into that bag while being misled that they might potentially pay out 90.88%. How do they figure that? Here you go. It says it right here. The distribution rate is the annual rate at which an investor would receive if the most recent distribution which includes option income remained the same.
Ah, interesting. Now, what happens if we don't include options income? Well, the 30-day SEC yield represents the net income, which excludes option income. So, we know they're upside down on their options because they disclose their holdings. We know they're upside down on those, but they paid out option premium nonetheless.
And they're taking that option premium, multiplying it by 12, and telling you, "Oh, if we did this forever, we could get you a 90% return." The SEC is like, "Dude, we don't know that it's sustainable." that you could actually return 7% per month and do that for a year. So, we want you to disclose to investors how much money you're actually making without that options premium because you are holding a bag.
And even the SEC yield doesn't tell you about the bag they're holding. And the misleading part is the biggest bag that they're holding doesn't even show up in the top 10 holdings. you actually have to go into the spreadsheet and scroll all the way to the bottom to find where they're losing money on nearly a billion dollars of sold puts.
Now, all of this could be fine if the market goes up. And this is the thing. This is how market bubbles work is when the market is going up, all of these crazy financial products work great. People make a crapload of money and they're like, I'm a genius because I invested and I got all this money back so rapidly.
Yes, that works when the market is going up. But what's happening right now is people who are buying MSTY today are buying thinking they're getting a distribution yield of 90% when what they're really getting is a giant bag of SH9T. Now, I want you to understand something else that's going on right now.
Bitcoin treasury companies outside of Micro Strategy hold $18 billion of Bitcoin or about 4.7% of outstanding supply. The problem with this is about 1th3 of Bitcoin treasury companies are upside down right now on the Bitcoin that they've bought. That's the problem. Also, you're getting into this cycle where Michael Sailor isn't able to raise as much money as he wanted to.
He previously told us that he would not issue any shares of Micro Strategy under a 2.5x premium. Well, two weeks later, what did he do? He issued 900,000 shares and changed the rules or the interpretation of the rules. Micro Strategy is currently trading for just a 1.39x premium. Now, we can speculate that, you know, maybe the best time to buy Bitcoin is when Micro Strategy goes belly up and all the debt is liquidated and that's going to be the best time to fundamentally buy Bitcoin.
But that really is a topic for a different video. The point of what I'm saying here is that the premium on Bitcoin at Micro Strategy is in decline right now, which unfortunately has the risk of accelerating the downtrend of what's happening on MSTY, the YieldMax product that makes YieldMax nearly $50 million while not advertising their bag and instead just advertising an annualized options premium payout that most people just aren't going to understand That is a big risk.
Now, all of what I'm saying is available on their website, but just understand how flywheels of momentum work. When the price of of Bitcoin goes up, Micro Strategy tends to go up. That is not happening right now. We're getting a divergence. The price of Micro Strategy is going down while the price of Bitcoin is going up.
That happened last in 2020 and 2021. It's a little bit of an omen. In addition to that, uh you are usually seeing Bitcoin go up. Micro Strategy go up, they issue more stock. As you issue more stock, you buy more Bitcoin, which leads Bitcoin to go up, which leads to rising stock prices. When charts go up, people buy.
People feel safer when charts go up. The reality is you should feel safer when stocks are going down because you're buying them at a cheaper price. Except for at companies like MSTY because you're buying into a big bag that could go to zero. This isn't like, oh, we have all this money and if we close it down, you know, we'll give you all the money back.
They could literally end up massively upside down because they're playing options and options go to zero. That happens. So, you have to be aware of that. Now, something to remember is that we're potentially entering a flywheel at Micro Strategy that isn't great right now, where as the stock price of Micro Strategy goes down, you can't fund raise as much.
Michael Sailor's last fund raise raised only $47 million, which is a fraction of what he wanted to raise and is a bad omen for his ability to keep fundraising. Eventually, you get low stock price to low fundraising, which is where we are now. That eventually becomes a no fundraising. Then it becomes concern over existing debt and the dilution that's happened at Micro Strategy.
And then you get more of a compression in Bitcoin value and premium. But that could actually turn negative when it comes to actually paying the debt back in 2028 and 9 and 30 or otherwise via the vehicle, you know, the the vehicles that Michael Sailor has set up, which leads to less support for Bitcoin.
Unfortunately, these sort of plays like MSTR or MSTY both create great support for Bitcoin on the upside. unfortunately probably frothing it up, but they create really big risk on the downside because you actually have a a legal opportunity to blatantly mislead people who don't understand. Now, I'm not trying to say that
Comments 0