6 Leveraged ETFs With Triple-Digit Returns

December 24, 2013

These six leveraged U.S. equity ETFs turbo-boosted their returns in 2013.

Over the past year, U.S. equities have been an investor’s sweet spot, so it follows that leveraged U.S. equity ETFs would be among some of the highest returns during 2013. Leveraged exchange-traded funds are designed to hyper-rally for short periods when their target market moves up.

How high those returns shot up, and which corners of the U.S. equity market enjoyed the loftiest gains, is where it gets interesting.

Here we scope out the six-best-performing leveraged funds within the ETF equity space, in ascending order.

6. The ProShares UltraPro QQQ fund (TQQQ) has spiked 114 percent.

TQQQ serves up leveraged exposure to a market-cap-weighted basket of Nasdaq stocks. It’s geared to three times the returns of its underlying. Within its 100 securities are the largest nonfinancial companies on the Nasdaq exchange.

It’s three times leverage is only with a one-day investment intention. Leveraged funds aren’t intended to be held long term—to do so could destroy a portfolio.

However, TQQQ has rallied 114 percent in a 12-month period. And it’s only the sixth-best performing leveraged U.S. equity fund.

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