Defiance's MSTX ETF Sees $127 Million Inflows in Six Days
Defiance’s controversial new single-stock long leveraged MicroStrategy exchange-traded fund (ETF) trading under the ticker “MSTX” has seen $127 million inflows in six days, according to Bloomberg Intelligence data.
The MSTX ETF officially began trading on 21 August and has been trading over $100 million in daily volume, highlighting its quick grassroots success, as noted by Eric Balchunas, a senior ETF analyst at Bloomberg Intelligence.
Balchunas pointed out the rapid growth of the fund, showcasing strong investor interest in the ETF.
Defiance ETFs: Leveraged Exposure to Disruptive Companies
The firm behind the listing, Defiance ETFs, was founded in 2018 and is dedicated to income and thematic investing. The single-stock ETF from Defiance provides leveraged exposure to disruptive companies without requiring a margin account.
MicroStrategy, the company behind the ETF, headed by executive chairman Michael Saylor, recently reported an increase in its bitcoin holdings to 226,500 in the second quarter of 2024.
One of the Most Volatile ETFs Around?
Before its listing, the MSTX ETF had gained attention for being one of the most volatile ETFs in the U.S. market, a characteristic familiar to bitcoin investors who are accustomed to the asset's price fluctuations.
The ETF has faced criticism from some financial publications, with concerns raised about the SEC's approach to regulating such ETFs and the potential impact on the broader crypto ETF landscape.
U.S. Quick to List and Close ETF Products
The U.S. ETF market has a history of experimenting with and swiftly listing niche ETFs. In the first half of 2024, the market witnessed closures of 91 ETFs, showcasing a willingness to test innovative products but also a readiness to close underperforming or unsustainable funds.
Despite the concerns and criticisms surrounding the high volatility and speculative nature of the MSTX ETF, it has attracted substantial investor interest, demonstrating the appeal of gaining exposure to MicroStrategy through a leveraged ETF product.
