Part 10/13:
Evaluating Leo Strategy can be akin to analyzing MicroStrategy’s Bitcoin holdings. MicroStrategy’s market price trades at a 32.6% premium compared to its net asset value (NAV), primarily due to the growth potential of its Bitcoin holdings. Similarly, Leo Strategy’s NAV per share is approximately $2.38, yet its market trading price hovers around $2.13, representing an 11% discount.
This discount presents an interesting opportunity: the fund’s current assets are worth $2.38 per share, but the market undervalues it relative to this valuation. If the strategy continues its growth trajectory—adding LEO at a rapid clip and expanding its arbitrage volume—the market’s perception could shift, leading to a premium akin to MicroStrategy’s.