US-based asset manager REX Shares has launched an exchange-traded fund that bundles leveraged covered call strategies tied to nine individual stocks, including crypto-related names Coinbase and Strategy, into a single income-focused product under the ticker GIF.
According to Thursday’s announcementThe fund holds equal-weighted positions in REX’s existing single-stock growth and income ETFs, each targeting approximately 1.25 times exposure to its underlying stocks while writing covered calls on a portion of the portfolio to generate option premium income.
GIF trades on Cboe Global Markets and each underlying ETF seeks to distribute income on a weekly basis, with payments largely coming from covered call premiums.
Covered call premiums are the upfront payments a fund collects for selling options on stocks it already owns, generating income in exchange for capping a portion of the stock’s upside potential.
REX Shares said the ETF holds equal-weighted exposure to nine REX funds related to Nvidia (NVII), Tesla (TSII), Strategy (MSII), Coinbase (COII), Robinhood (HOII), Palantir (PLTI), CoreWeave (CWII), Eli Lilly (LLII) and Walmart (WMTI), covering the crypto-related stocks, technology, AI, healthcare and retail sectors.
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21Shares Lists STRC ETP as Firms Add Strategy Preferred Stock to Treasuries
The launch comes amid a week of new allocations linked to securities linked to the strategy.
Wednesday, 21Shares introduced an exchange-traded product (ETP) offering European investors exposure to STRC, Strategy’s floating rate perpetual preferred stock. The 21Shares Strategy Yield ETP began trading on Thursday on Euronext Amsterdam under the symbol STRC NA.
Also Wednesday, Strategy said Prevalon Energy, an energy infrastructure company, and Digital Anchoragea crypto-focused digital asset bank, had allocated part of their company’s cash flow at STRC, without however disclosing the size of their positions.
Strategy describes STRC as a digital credit instrument with an annual dividend of 11.25%, part of its broader effort to issue fixed income securities linked to its Bitcoin (BTC) assets.
Since adopting its Bitcoin treasury strategy in August 2020, Strategy has become the largest holding company of Bitcoin, declaring 717,722 BTC, or approximately 3.4% of the fixed supply of 21 million.
Despite demand for securities linked to the strategy, the company’s shares fell alongside the price of Bitcoin. The stock is down more than 60% over the past six months and about 50% over the past year, according to Yahoo Finance. data.
Strategy also emerged as the most important factor short circuited U.S. large-cap stocks in Goldman Sachs’ latest ranking, based on short interest relative to market value.
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