YieldMax MSTR Option Income Strategy ETF Offers 65% Annual Yield but High Risks
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2d ago
0mins
Source: Fool
- Single Stock Investment Risk: The YieldMax MSTR Option Income Strategy ETF is concentrated in one stock, Strategy (formerly MicroStrategy), which lacks diversification and exposes investors to significant risks during downturns, potentially leading to substantial losses.
- Unreliable Dividend Volatility: The ETF's dividend is driven by options trading opportunities, with historical fluctuations ranging from $2.37 to $0.13 per share over the past year, indicating instability that may not meet the needs of investors relying on dividends for living expenses.
- Declining ETF Value: Since inception, the YieldMax MSTR ETF has reported a total return of approximately 90%, but without reinvesting dividends, the share price has declined over 60%, contradicting the stability and growth expectations of most income-focused investors.
- Unsuitable for Income Investors: While the high yield of YieldMax MSTR ETF is enticing, the associated risks and trade-offs render it unsuitable for most income-oriented investors, potentially resulting in insufficient capital returns.
Analyst Views on MSTR
Wall Street analysts forecast MSTR stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MSTR is 453.17 USD with a low forecast of 229.00 USD and a high forecast of 705.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
14 Analyst Rating
12 Buy
2 Hold
0 Sell
Strong Buy
Current: 160.580
Low
229.00
Averages
453.17
High
705.00
Current: 160.580
Low
229.00
Averages
453.17
High
705.00
About MSTR
Strategy Inc., formerly MicroStrategy Incorporated, is a bitcoin treasury and business intelligence company. The Company provides cloud-native, artificial intelligence (AI)-powered enterprise analytics software to thousands of global customers. The Company’s Strategy ONE platform provides access to AI-powered workflows, unlimited data sources, cloud-native technologies, and performance to speed up time from data to action. Strategy One delivers visualization, reporting, and embedded analytics capabilities across retail, banking, technology, manufacturing, insurance, consulting, healthcare, telecommunications, and the public sector. Its Strategy Mosaic is a universal intelligence layer that provides enterprises with consistent definitions and governance across data sources, regardless of where that data resides or which tools access it. The Strategy Mosaic offers data clarity and connection by eliminating trade-offs between flexibility, control, and speed.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
