GraniteShares submits application for leveraged ETF of crypto-related companies including MicroStrategy

GraniteShares, an asset management company with more than $10 billion in AUM, has filed for new leveraged ETFs to track the stock prices of crypto-related companies such as Riot Platforms, Marathon Digital, MicroStrategy and Robinhood. These funds will be both long and short, and a 2x long ETF will generate twice the daily return of the corresponding stock. For example, when Riot Platform's stock rises 1%, the GraniteShares 2x Long RIOT ETF will rise 2%. This year, as cryptocurrency and stock markets have risen to all-time highs, these leveraged ETFs have become very popular. Among them, the T-Rex 2x Long MSTR Daily Target Fund (ticker MSTU) has attracted more than $1.8 billion in assets under management. Similarly, the Defiance Daily Target 2X Long MSTR ETF (ticker MSTX) has accumulated $1.8 billion in assets. These funds have outperformed MicroStrategy over the past three months, with MicroStrategy shares up 150% during that period, while MSTU and MSTX have risen 308% and 253%, respectively. The risk, however, is that they typically perform worse than the underlying stocks in a bear market. MicroStrategy stock is down 24% over the past 30 days, while MSTU and MSTX have fallen more than 50% over the same period. (crypto.news)