I know several others have already figured this out but wanted to share this as well for those who have not. After owning Bitcoin outright for years, dabbling in the CME futures market, and investing in MicroStrategy last year, I have determined that for most investors wanting Bitcoin exposure, purchasing shares of MSTR is actually a smarter decision then owning Bitcoin outright or using CME futures for leverage. MSTR is a marginable security typically allowing you to own up to 2X the amount of your equity, which means you get 2 times the potential returns (minus principal and interest) and the margin requirements remain fixed at the initial purchase price of your stocks. Although margin requirements on the CME roughly give you 3x purchasing power, there are some issues that make it less attractive. You will need to roll contracts over typically monthly or quarterly, which adds additional tax considerations. Bitcoin price drawdowns, which will happen, will become much riskier to your position at 3x leverage, and as the value of Bitcoin increases, the margin requirements on the CME also increase with it, meaning that as the value of Bitcoin increases you can not add more futures positions without crossing over the current margin requirement if you were initially close to it. When owning MSTR stocks, as the price of Bitcoin increases and MSTR with it, you can add to the position using your increased margin loan allowance. Any leveraged position is subject to calls and liquidation, so you will need to plan for those risks. MicroStrategy is also continuously adding more bitcoin to its portfolio which means your exposure becomes greater over time. You do not get this with CME futures. Additionally, if in event that BTC dries up on exchanges, proxies such as MSTR may be one of the only other available alternatives to gain exposure to the asset outside of ETFs or derivatives, making it even more valuable. For this bull run, I believe this is the move.
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