MSTY or your own covered calls on MSTR: what each one gives up
MSTY lets you run a covered-call-style trade on MSTR without buying 100 shares. Doing it yourself costs far more to start, but you choose the strike, the date and when to sit out. In a bad month, that choice is worth a lot.
The short answer
MSTY is a YieldMax fund built on MSTR, the stock of Strategy (formerly MicroStrategy), a company known for holding a large amount of bitcoin. As of October 2026, the fund doesn't own MSTR shares. It builds the stock's moves out of options, sells call spreads on top, and pays out the premium weekly.
Selling covered calls on MSTR yourself means owning 100 shares and selling one Call option on them at a strike and date you pick.
Both collect premium. Both give up the big up moves. Both take nearly the full drop. The fund is easier to start. Doing it yourself gives you control. This isn't a recommendation to buy or sell MSTY or MSTR.
How YieldMax builds these funds is explained in how YieldMax ETFs work. The method can change, so check the fund's current page before you rely on it.
Side by side
| MSTY | Your own covered call on MSTR | |
|---|---|---|
| Money to start | One fund share | 100 MSTR shares |
| Owns the shares | Usually no: options stand in for them | Yes |
| Picks the strike and date | The fund | You |
| Can skip selling after a crash | No | Yes |
| Options approval needed | No | Yes, covered calls |
| Upside | Capped at each call the fund sells | Capped at your strike |
| Downside | Nearly the full drop of MSTR | Nearly the full drop of MSTR |
| Cost | A yearly fund fee | Commissions and the bid-ask spread |
The 100-share barrier, in numbers
A covered call covers 100 shares. That's the whole reason most people look at MSTY.
Here's what 100 shares cost at different made-up prices. Check today's MSTR price for the real number.
| MSTR price (hypothetical) | 100 shares cost | If the stock falls 30% |
|---|---|---|
| $100 | $10,000 | −$3,000 |
| $300 | $30,000 | −$9,000 |
| $500 | $50,000 | −$15,000 |
That last column is the point. MSTR is a very jumpy stock. Its calls pay a big premium because the market expects big moves, both ways. That's what high Implied volatility means.
If 100 shares are more than you could lose 30% of without panic, the size is wrong. The fund lowers the entry price. It doesn't lower the swings.
One bad month, worked out (hypothetical)
This is an illustration, not a trade idea, and it isn't MSTY's real trades. A made-up MSTR price starts at $300. Compare three people with the same $30,000 at stake.
- The shareholder owns 100 shares.
- The do-it-yourself seller owns 100 shares and sells one 30-day $330 call for $15. That's $1,500 collected.
- The fund holder has $30,000 in a made-up fund like MSTY. Here it resets its calls every week, a hypothetical schedule.
The stock falls hard for two weeks, then bounces.
| Week | Stock | Fund's weekly call | Fund's week |
|---|---|---|---|
| 1 | $300 → $255 | $315 strike, +$600 | −$4,500 + $600 = −$3,900 |
| 2 | $255 → $210 | $270 strike, +$600 | −$4,500 + $600 = −$3,900 |
| 3 | $210 → $250 | $220 strike, +$700 | capped: +$1,000 + $700 = +$1,700 |
| 4 | $250 → $270 | $260 strike, +$800 | capped: +$1,000 + $800 = +$1,800 |
At month end, MSTR is at $270, down $30.
| Month's result | |
|---|---|
| Shareholder | −$3,000 |
| Do-it-yourself seller | −$3,000 + $1,500 = −$1,500 |
| Fund holder | −$4,300 |
The fund holder lost the most, even though the fund collected $2,700 in premium. It took the full drop in weeks one and two. Then, near the bottom, it sold calls at $220 and $260. When the stock bounced, those calls capped the climb.
The do-it-yourself seller lost money too. But their one call sat at $330, well above the bounce. They kept the whole recovery from $210 to $270.
Some of the fund's loss reaches you as payouts, and the rest as a lower share price. That pattern, repeated, is NAV erosion.
What each one is really good at
The fund is good at: - letting a small account run this trade with one share; - doing the work every week without you; - no options approval.
Doing it yourself is good at: - picking a strike above your cost, so the bounce isn't capped; - pausing after a crash instead of selling calls at the bottom; - skipping weeks around big news; - owning real shares you can sell when you choose.
The trade underneath is the same one taught in the wheel strategy: own the stock, sell a call, collect the premium. For how MSTY fits among income funds, start with how covered call ETFs work.
The Canadian angle
Covered calls on your own shares are widely allowed in a TFSA or RRSP, but options permissions differ by broker. A US-listed fund like MSTY held in a TFSA can lose part of its payouts to US withholding tax. See US covered call ETFs in a TFSA.
Questions
Does MSTY own MSTR stock?
No. As of October 2026, it builds MSTR's moves out of options instead of owning shares. Either way, the fund moves with MSTR on the way down.
Is MSTY the same as selling covered calls on MSTR?
It's close in shape, not the same. The fund chooses the strikes and dates and resets often. Doing it yourself, you choose, and you can skip selling when a call would cap a bounce.
How much money do I need to sell covered calls on MSTR?
Enough for 100 shares, at whatever MSTR trades for today. Then ask whether you could sit through a 30% drop on that amount.
Why can MSTY lose more than MSTR in a month?
When the stock falls and then bounces, the fund has often sold calls near the low. Those calls cap the bounce. So it can take the drop and miss the recovery.
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