That 85% ‘Yield’ Lost 73% in a Year: The Weekly Payday Fund That Ate Its Own NAV

The YieldMax MSTR Option Income Strategy ETF (NYSEARCA:MSTY) was sold to income seekers arsenic a mode to harvest the chaotic volatility of Strategy (formerly MicroStrategy) arsenic play cash. The transportation worked. MSTY concisely posted a trailing organisation complaint northbound of 85%, and retail investors piled successful expecting a lottery summons that paid rent. What they got alternatively was a money whose stock terms fell from a highest adjacent $40 to $12.83, with a one-year terms diminution of 68.39% and a full instrumentality of astir -72.7%, including each distributions paid. There is simply a cleaner mode to tally a weekly-income options strategy, and it lives 1 aisle implicit successful the aforesaid merchandise category.

Why Investors Bought MSTY successful the First Place

A synthetic covered telephone connected Strategy banal is what MSTY runs, selling short-dated calls against a synthetic agelong presumption and passing the enactment premium done arsenic play cash. When MSTR grinds sideways with precocious implied volatility, that strategy tends to people money. That is precisely what played retired successful 2024, erstwhile MSTY paid distributions of up to $4.4213 per stock connected November 21 of that year. Annualize a fistful of $3-plus payouts against a $20 stock price, and the eye-watering output that made MSTY a societal media favourite starts to marque sense.

Act now: the expert who called NVIDIA successful 2010 conscionable named his apical 10 AI stocks — and MSTY didn't marque the cut. Grab the names FREE today.

Where the Strategy Broke

Covered calls headdress upside and support each downside. Strategy's banal fell 74.91% implicit the past year, and MSTY's synthetic presumption took the afloat deed portion the sold calls expired worthless. The money kept distributing, truthful the main went retired the doorway arsenic "income." Weekly payouts collapsed from that $4.42 highest successful precocious 2024 to $0.2222 connected July 30, 2026. The organisation complaint inactive looks precocious due to the fact that the denominator, NAV, fell faster than the numerator. A output calculated connected a shrinking basal is simply a instrumentality of superior dressed up arsenic income.

Retail investors took announcement of the deterioration. A r/wallstreetbets station titled "Got liquidated but thankfully conscionable nether 25 truthful volition ne'er bash this ever again" drew 610 upvotes and 397 comments successful aboriginal July, and sentiment tracking crossed the illustration model was classified arsenic precise bearish astatine each snapshot.