STRF: A Carry Trade Opportunity Hiding In Plain Sight

Aaron Brown
23 Followers

Summary

  • STRF combines Bitcoin-linked upside and fixed-income stability in a structurally senior preferred security that remains mispriced.
  • With margin rates well below STRF's yield, investors can capture a net spread.
  • Bitcoin skepticism appears to remain embedded in STRF's pricing, offering investors the chance to earn income while the market reevaluates Bitcoin-linked products like STRF.

Young woman moving from currencies in stealth mode

Klaus Vedfelt/DigitalVision via Getty Images

Last August—like many other investors—I watched the yen carry trade crack seemingly overnight after a rapid change in rate expectations and the yen's relative strength to the U.S. dollar. For decades, traders had borrowed yen cheaply and

This article was written by

23 Followers
Aaron Brown is a corporate attorney with a focus on M&A transactions. He has a strong interest in the intersection of law and financial markets, and enjoys reading others' investment ideas. Passionate about long-term investing and new technologies, he contributes his own insights to Seeking Alpha as a way to engage with and learn from the broader community. He values thoughtful analysis and enjoys exploring emerging legal and financial topics through his writing.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of STRF, STRK, STRD, MSTR, AND BTC either through stock ownership, options, or other derivatives. 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.

This article is for informational purposes only and does not constitute investment advice, financial advice, or a recommendation to buy or sell any securities or cryptocurrencies. All investors should conduct their own due diligence and consult their financial advisor before making any investment decisions. The opinions expressed are solely those of the author and do not reflect the views of any employer or affiliated institutions.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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