Yea it is $1.44 :) but with all the yen unwinding and US markets crashing, bitcoin is in deep doodoo ... i feel like in Aug we will have VERY tiny dividend
They get/give the dividend by subtracting the dividend price from the stock price. They also charge a fee of 0.95 I believe. What I am confused about is if they actually make money from the futures strategy like other dividend funds that use a covered call strategy, etc. I am wondering what the purpose of their futures strategy is exactly. Why can't they just buy bitcoin like the other etfs do and then just give out a dividend by subtracting from the stock price? I believe in a way they were "forced" to give dividends since they are profitable. So do they make profits with their futures strategy in addition to their fee structure? Do they trade the futures with a strategy or is it more of a mechanical rollover type of thing each month or so?
So to clarify - "they" or BITO do not subtract dividend from share price to pay the dividend. Share price is based on NAV (net asset value) or value of the holdings dividend by outstanding shares. The reason price goes down after ex-dividend date is because dividend amount is "built" into the price. Meaning if stock is $20 and dividend will be $1 the next day, by buying "today" you are "guaranteed" $1/share in few days. Once stock is ex-dividend (meaning you no longer get current month dividend), price goes down by the amount of dividend and fluctuates based on NAV - if BTC goes up, NAV goes up, and vise versa. Now how they make money? For example, they "bought" futures when BTC is $60K ... if BTC goes up to $65K by the time they have to roll their monthly futures, BITO makes $5K difference, whichever way that is reflected in futures prices. If BTC is below 60K then BITO loses money, and cannot pay distributions ... They also have daily futures, and I don't know exactly how much the make on those (or the monthlies), because they do not post daily trades. PS - they are not "forced" to give dividends - that is the whole idea of the fund - pay dividends from futures income. That is how the fund works. PS2 - the rollover is required because the futures contracts expire each months, and BITO invests in monthly contracts. I really wish they posted daily trades like YieldMax does.... but oh well...
Hello I have some doubts about this asset. Even though BITO is aimed at the bitcoin futures market, I see that it is very uncorrelated with the price of bitcoin. Is there any type of dilution of shares over time? Are new quotas being issued every month? Even with the recurring payment of dividends and despite being reinvesting the dividends, I have less money now than I did 4 months ago and I'm not even considering today's market drop. Is this fund really a good long-term option?
So... We don't know the future 😕 ... And historically this fund underperforms BTC... Its purpose is to provide income NOT FINANCIAL ADVICE, but... If you think "4 years" (not 4 months), most likely you will be in the green... If you are worried, stop reinvesting dividends until you break even. I've had this since inception 3 years ago, and my current cost basis is $10.60 At the current dividend amount, it will completely pay for itself in about 7 months. If the average dividend drops to $1, it will pay for itself in 11 months. If the dividend drops to $0.50, it will be 21 months... This doesn't account for selling covered calls ... Right now i can sell Jun '25 call ($25 strike) for around $2.1 ... That is 11.35% upfront and potentially 35% upside if i get assigned... Plus dividends collected during this period I'm not selling covered calls right now because i think BTC will go to $80k or higher around by the end of 2024... And then, BITO price should be much higher, so i could get much higher premiums for calls. And if it doesn't, i will keep collecting dividends... Now i don't know what to recommend for you... I'm not an advisor...i just explain my strategy ... I think in longer than 4 months terms However you need to know that this fund can easily go to $10 if BTC drops... If it goes to $10, i will not be selling... instead i will be buying, because eventually it should recover ... I already held it through sub $9 .... I know it can be hard looking at RED numbers... But this is not a 4 month investment.... AGAIN - THIS IS NOT FINANCIAL ADVICE
@@dripcalc I have actually invested in the fund for 3 years. I spent most of that time in the red, but considering the dividends paid, I believe I have already doubled the amount I initially invested. To tell the truth, I have learned to be patient with this fund. I gave the example of 4 months ago, because the value of bitcoin was the same as it was 4 months ago, but the bito share is worth 25% less today. Even with the dividends paid, month by month I am getting poorer if I consider the last 4 or 5 months. This is something that I cannot understand given the current scenario of bitcoin, which has been growing massively every day. What I would really like to know is whether there is dilution over time. Are new shares issued by the company every month, diluting investors? If what is happening now is mere market speculation, no problem, but my real concern is whether I can rest assured with my money because the company is serious.
Ty for the estimate
Cheers... Don't forget to like and sub 😁
looks like 1.44
Yea it is $1.44 :)
but with all the yen unwinding and US markets crashing, bitcoin is in deep doodoo ... i feel like in Aug we will have VERY tiny dividend
They get/give the dividend by subtracting the dividend price from the stock price. They also charge a fee of 0.95 I believe. What I am confused about is if they actually make money from the futures strategy like other dividend funds that use a covered call strategy, etc. I am wondering what the purpose of their futures strategy is exactly. Why can't they just buy bitcoin like the other etfs do and then just give out a dividend by subtracting from the stock price? I believe in a way they were "forced" to give dividends since they are profitable. So do they make profits with their futures strategy in addition to their fee structure? Do they trade the futures with a strategy or is it more of a mechanical rollover type of thing each month or so?
So to clarify - "they" or BITO do not subtract dividend from share price to pay the dividend. Share price is based on NAV (net asset value) or value of the holdings dividend by outstanding shares.
The reason price goes down after ex-dividend date is because dividend amount is "built" into the price.
Meaning if stock is $20 and dividend will be $1 the next day, by buying "today" you are "guaranteed" $1/share in few days. Once stock is ex-dividend (meaning you no longer get current month dividend), price goes down by the amount of dividend and fluctuates based on NAV - if BTC goes up, NAV goes up, and vise versa.
Now how they make money? For example, they "bought" futures when BTC is $60K ... if BTC goes up to $65K by the time they have to roll their monthly futures, BITO makes $5K difference, whichever way that is reflected in futures prices. If BTC is below 60K then BITO loses money, and cannot pay distributions ...
They also have daily futures, and I don't know exactly how much the make on those (or the monthlies), because they do not post daily trades.
PS - they are not "forced" to give dividends - that is the whole idea of the fund - pay dividends from futures income. That is how the fund works.
PS2 - the rollover is required because the futures contracts expire each months, and BITO invests in monthly contracts.
I really wish they posted daily trades like YieldMax does.... but oh well...
Hello I have some doubts about this asset. Even though BITO is aimed at the bitcoin futures market, I see that it is very uncorrelated with the price of bitcoin. Is there any type of dilution of shares over time? Are new quotas being issued every month? Even with the recurring payment of dividends and despite being reinvesting the dividends, I have less money now than I did 4 months ago and I'm not even considering today's market drop. Is this fund really a good long-term option?
So... We don't know the future 😕 ... And historically this fund underperforms BTC... Its purpose is to provide income
NOT FINANCIAL ADVICE, but...
If you think "4 years" (not 4 months), most likely you will be in the green... If you are worried, stop reinvesting dividends until you break even.
I've had this since inception 3 years ago, and my current cost basis is $10.60
At the current dividend amount, it will completely pay for itself in about 7 months.
If the average dividend drops to $1, it will pay for itself in 11 months.
If the dividend drops to $0.50, it will be 21 months...
This doesn't account for selling covered calls ... Right now i can sell Jun '25 call ($25 strike) for around $2.1 ... That is 11.35% upfront and potentially 35% upside if i get assigned... Plus dividends collected during this period
I'm not selling covered calls right now because i think BTC will go to $80k or higher around by the end of 2024... And then, BITO price should be much higher, so i could get much higher premiums for calls.
And if it doesn't, i will keep collecting dividends...
Now i don't know what to recommend for you... I'm not an advisor...i just explain my strategy ... I think in longer than 4 months terms
However you need to know that this fund can easily go to $10 if BTC drops... If it goes to $10, i will not be selling... instead i will be buying, because eventually it should recover ... I already held it through sub $9 ....
I know it can be hard looking at RED numbers... But this is not a 4 month investment....
AGAIN - THIS IS NOT FINANCIAL ADVICE
@@dripcalc I have actually invested in the fund for 3 years. I spent most of that time in the red, but considering the dividends paid, I believe I have already doubled the amount I initially invested. To tell the truth, I have learned to be patient with this fund. I gave the example of 4 months ago, because the value of bitcoin was the same as it was 4 months ago, but the bito share is worth 25% less today. Even with the dividends paid, month by month I am getting poorer if I consider the last 4 or 5 months. This is something that I cannot understand given the current scenario of bitcoin, which has been growing massively every day. What I would really like to know is whether there is dilution over time. Are new shares issued by the company every month, diluting investors? If what is happening now is mere market speculation, no problem, but my real concern is whether I can rest assured with my money because the company is serious.
@@dripcalc Do you consider a possible reverse split?
Hope they pay good this August 💰💰💰💰💰💰💰💰
Yea so do i... Hoping for $1.80... but likely $1.40 because of bad June