Analysis

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About Defiance Daily Target 1.5x Short MSTR ETF

SMST uses swap agreements to make bearish bets on MicroStrategy Incorporateds (NYSE: MSTR) share price. MSTR was originally known for its enterprise analytics software. It has then pivoted to include acquiring and holding bitcoin as another operational business. The fund maintains a daily leveraged exposure equivalent to -150% of the funds net assets through daily rebalancing. As a geared product, the fund is intended as a short-term tactical tool, rather than as a long-term investment vehicle. As a result, returns may deviate from the expected -1.5x if held for longer than a single day due to compounding. This strategy is high-risk and does not include a defensive position as part of its overall process. Additionally, the fund could potentially lose money over time, even if MSTR's performance strengthens. The fund is expected to invest in cash-like instruments as collateral.