Summary:
Strive's ETF aims to offer Bitcoin exposure through "Bitcoin Bonds," focused on MicroStrategy convertible securities.
The ETF seeks to participate in the growing institutionalization of Bitcoin.
It will invest at least 80% of its assets in Bitcoin Bonds and related derivatives.
The fundâs performance will be closely tied to MicroStrategyâs Bitcoin investments.
This innovative ETF highlights investorsâ growing appetite for using MicroStrategy as a proxy for Bitcoin exposure.
Strive's ETF Seeks Bitcoin Exposure Through MicroStrategy-Inspired Derivatives
Strive Asset Management is launching a new ETF designed to provide exposure to Bitcoin via convertible securities, primarily focusing on MicroStrategyâs holdings. The Strive Bitcoin Bond ETF aims to capitalize on the growing institutionalization of Bitcoin.
- Investment Strategy: The ETF will invest at least 80% of its assets in "Bitcoin Bonds" and related derivative instruments, including swaps and options. It will actively manage positions in Bitcoin-linked convertible securities and derivatives, making allocation decisions based on cost and return potential.
- Asset Management: The fund will maintain cash positions in short-term US Treasury securities and may invest in other Bitcoin-focused investment vehicles. As a non-diversified fund, it can concentrate holdings in single issuers like MicroStrategy and allocate over 25% of assets to the software and technology sector.
- Management Structure: Operated under a âmanager of managersâ structure, the ETF will be advised by Empowered Funds, LLC, which has the flexibility to appoint and replace sub-advisers without shareholder approval.
- Trading and Performance: The fundâs shares will trade on the New York Stock Exchange and be held through the Depository Trust Company. Its performance will be closely tied to MicroStrategyâs Bitcoin investment outcomes, as the company has been adopting a Bitcoin treasury strategy since 2020.
- Investor Appeal: The ETF intends to leverage MicroStrategyâs investments by utilizing its derivatives positions as novel financial instruments, showcasing the growing investor appetite to use MicroStrategy as a proxy for Bitcoin exposure.
The ETF plans to qualify as a regulated investment company and aims to distribute net investment income quarterly and capital gains annually. It may engage in securities lending up to 33 1/3% of total assets and can invest up to 15% in illiquid securities.
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