IMST ETF Analysis: Dividends, Returns AMEX:IMST

Analysis

Key stats

IMST aims to generate current income while providing exposure to the price returns of MicroStrategy Incorporated stock (MSTR), subject to a cap on potential gains. The fund utilizes a synthetic covered call strategy via standardized exchange-traded and FLEX options, which consists of three elements: i) synthetic long exposure, ii) covered call writing, and iii) US Treasurys for collateral. The synthetic long exposure seeks to replicate the price movements of MSTR by purchasing call options and selling put options at the same strike price. To generate income, the fund will sell out-of-the-money call options on MSTR at a strike price of approximately 0%-15% above its current share price. This limits participation in potential gains if MSTR shares increase in value. The short put positions fully expose investors to the downside of the stock. Note: the fund does not invest directly in MSTR stocks. Thus, investors are not entitled to any MSTR dividends.