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BST: Overrated, With Hidden Fundamental Flaws
Summary
- An 8%+ yield may look attractive initially, but fundamental flaws emerge upon reviewing the fund’s financial statements and distribution history.
- Management has incurred losses on options writing. Return-of-capital distributions and a negative CAGR indicate subpar portfolio management practices.
- BST has underperformed in terms of capital appreciation compared to other tech-focused ETFs like QQQM. Better alternatives exist, such as STK.
- Attempting to profit from a discount gapreduction is more speculative than a sound, long-term investment strategy.
When I first delved into trading and securities back in 2002, I was overwhelmed by the abundance of financial jargon, securities, and derivatives. Since then, I’ve made it my mission to learn everything I could about finance, economics, and business, which led me to earn multiple degrees from top institutions in both Europe and North America. My time as a small business owner in the hospitality and clothing retail industries gave me firsthand insight into the mechanics of business and the elements that drive success, an experience that provides me with an edge over other analysts in fundamental analysis. For three years, I served as a research analyst for a fintech incubator, where I was deeply involved in analyzing data and trends to assess startups' potential. Since early 2020, I have thrived as an independent technical trader across global markets, achieving a win rate of over 60%. Through the years, I’ve made plenty of mistakes and learned valuable lessons from each one. Now, my mission is to make investing, especially ETF investing, simple and accessible for everyone - so you can hit the ground running from the start.
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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