MSTY Dividend Calculator

Three projection scenarios

The calculator on this page uses MSTY's current forward yield of approximately 94% as its starting point. Because MSTY launched in February 2024 and has fewer than five full calendar years of history, there is no computed five-year dividend growth rate. The calculator's default 7% annual DGR is a generic fallback, not a forecast derived from MSTY's actual payout history. The three scenarios below explore what that default assumption implies versus more conservative alternatives — all using $10,000 as the starting investment, $200 monthly contributions, and DRIP enabled.

Base case: 94% yield, 7% DGR

The base case applies the calculator's default settings. At a 94% forward yield, the starting annual income on $10,000 is roughly $9,400 — nearly the full initial investment returned as distributions in year one. With DRIP enabled and $200 monthly contributions, the share count grows each month from both reinvested distributions and new capital. Apply a 7% DGR on top of that compounding and the projected income trajectory rises steeply over long horizons.

At the 5-year mark, the combination of share-count compounding and the assumed DGR produces a substantially higher annual income run-rate than year one. At 10 years, the compounding effect is dramatic — far exceeding what the initial $10,000 would suggest at face value. At 25 years, the projection implies an income stream that dwarfs the original capital by a wide margin.

These numbers are mathematically correct given the inputs — but they should be treated with deep skepticism for MSTY specifically. A 7% annual growth in MSTY's per-share distribution assumes the option premium environment, MSTR's volatility, and the fund's NAV trajectory all remain favorable over decades. None of those conditions is reliable, and the 7% DGR is a generic placeholder, not an MSTY-specific estimate. The base-case output is most useful as a benchmark to compare against the flat and shrinking scenarios below.

Flat distribution: 94% yield, 0% DGR

The flat-distribution scenario assumes option premiums — and therefore per-share distributions — stay roughly constant in nominal terms over the projection period. No growth, no decline. The same 94% starting yield compounds purely through share-count accumulation under DRIP and ongoing $200 contributions.

Compared to the base case, this outcome produces a noticeably lower annual income at each time horizon. At 5 years the gap is visible; at 25 years the divergence is large. The flat scenario is arguably the more realistic planning assumption for an option-income fund with no dividend-growth history — it captures the compounding from reinvested distributions without embedding an optimistic premium-growth assumption. Investors who want a conservative floor for planning purposes should weight this scenario more heavily than the base case.

Shrinking distribution: 94% yield, -3% DGR

The shrinking-distribution scenario applies a -3% annual decline in per-share payouts. This is especially relevant for option-income strategies because NAV erosion during large upside moves in the underlying reduces the asset base on which future premiums are earned. As the fund's NAV shrinks, the absolute dollar amount of premium collected per share tends to decline even if the yield-on-NAV stays high.

Compared to the base case, a -3% DGR scenario produces meaningfully lower income at every horizon — and compared to the flat case, the shortfall widens each year. At longer horizons, the shrinking-distribution case illustrates how NAV erosion can work against compounding even when DRIP is reinvesting every dollar. Investors who have observed MSTY's NAV trajectory since launch and want to model a continuation of that trend should run this case alongside the base and flat cases.

Limits of these projections

The calculator provides a clean, smooth projection — but MSTY's actual behavior is neither clean nor smooth. Four structural limits are worth keeping in mind before relying on any long-horizon output.

Distribution variance is high and not modeled

MSTY's monthly distributions span a range of more than 50% across the trailing year — the seed data shows lows near $1.50 and highs near $2.30 — and typical month-to-month changes average about 20%. The calculator assumes a smooth annualized stream — the month-to-month swings are invisible in the projection table. Before relying on MSTY distributions as a regular income source, review the Recent dividends table on the calculator page to get a sense of actual variance. Budgeting around the average is likely to produce months of undershoot.

No five-year DGR exists for MSTY

MSTY launched in February 2024. The five-year DGR field in the computed data is null by definition — not because the data is missing, but because the fund has not existed long enough to produce one. The 7% DGR the calculator uses as a fallback is the same default applied to every ticker without a computed DGR. It has no specific relationship to MSTY's payout history or forward outlook. Users should treat long-horizon projections with extra caution and experiment with 0% and negative DGR values as alternative inputs.

NAV erosion is not modeled

The most important structural risk for MSTY is NAV erosion, and the calculator does not model it. A 25-year projection assumes that the share count accumulated through DRIP retains its value — but MSTY's share price has declined since inception as large MSTR rallies eroded the fund's net asset value. In the real world, the same share count bought at a higher NAV is worth less as NAV falls. The calculator's compounding math is correct given its assumptions; the gap between those assumptions and MSTY's observed behavior is the main reason to use multiple scenarios and to monitor actual NAV alongside income.

After-tax modeling for ROC is not yet available

For taxable accounts, the calculator's after-tax projection treats distributions as ordinary income. MSTY's distributions are largely classified as return of capital, which is more tax-favorable — ROC reduces cost basis rather than generating current-year tax liability. This means the calculator's after-tax projection understates the actual after-tax yield for taxable holders. A full marginal-rate analysis should use the tax calculator with an awareness that most MSTY distributions will be reclassified at year-end. Tax-advantaged account holders can disregard this caveat entirely.