Inverse ETF Overview

Inverse ETFs are powerful and complex trading instruments. They allow traders to benefit from price declines in major ETFs. For example, if the SPDR S&P 500 fund (SPY) goes down 1% on one day, you should expect that the price of ProShares Short S&P 500 ETF (SH) goes up 1% the same day. Inverse ETFs can use leverage as well to magnify their returns. Thus, these inverse-leveraged ETFs need to be handled with care.

Keep in mind that inverse ETFs deliver the desired returns over prespecified periods only—usually one day. Thus, the stated multiple (e.g., - 2x) of the fund's underlying index only attempts to do so over one-day holding periods. Consequently, inverse ETFs can be inappropriate investment vehicles to hold if you have a significantly longer holding period in mind.

With 119 ETFs traded in the U.S. markets, Inverse ETFs gather total assets under management of $11.85B. The average expense ratio is 1.02%. Inverse ETFs can be found in the following asset classes:

  • Equity
  • Commodities
  • Alternatives
  • Fixed Income

The largest Inverse ETF is the ProShares Short S&P500 SH with $1.78B in assets. In the last trailing year, the best performing Inverse ETF was the SVXY at 372.98%. The most-recent ETF launched in the Inverse space was the MicroSectors U.S. Big Oil Index -3X Inverse Leveraged ETN NRGD in 04/09/19.

TOP ETF PERFORMERS

DGAZ VelocityShares 3X Inverse Natural Gas ETN 15.61%
JDST Direxion Daily Junior Gold Miners Index Bear 3X Shares 11.78%
EXIV VelocityShares 1X Daily Inverse VSTOXX Futures ETN 11.51%
BZQ ProShares UltraShort MSCI Brazil Capped 11.48%
KOLD ProShares UltraShort Bloomberg Natural Gas 10.34%

BOTTOM ETF PERFORMERS

WTID UBS ETRACS - ProShares Daily 3x Inverse Crude ETN -30.33%
OILD ProShares UltraPro 3x Short Crude Oil ETF -30.33%
USOD United States 3x Short Oil Fund -30.18%
DRIP Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 3X Shares -29.86%
DWT VelocityShares 3x Inverse Crude Oil ETN -29.86%

TOP CREATIONS

SQQQ ProShares UltraPro Short QQQ 153.29
SH ProShares Short S&P500 146.37
DGAZ VelocityShares 3X Inverse Natural Gas ETN 49.90
SPXS Direxion Daily S&P 500 Bear 3X Shares 38.93
SDS ProShares UltraShort S&P500 38.06

TOP REDEMPTIONS

JDST Direxion Daily Junior Gold Miners Index Bear 3X Shares -27.64
EFZ ProShares Short MSCI EAFE -24.05
TBF ProShares Short 20+ Year Treasury -20.78
TBT ProShares UltraShort 20+ Year Treasury -15.57
LABD Direxion Daily S&P Biotech Bear 3X Shares -12.56

AUM WINNERS

DPK Direxion Daily MSCI Developed Markets Bear 3x Shares 165.14%
DRIP Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 3X Shares 123.58%
WDRW Direxion Daily Regional Banks Bear 3X Shares 98.63%
OILD ProShares UltraPro 3x Short Crude Oil ETF 69.04%
DWT VelocityShares 3x Inverse Crude Oil ETN 66.84%

AUM LOSERS

RISE Sit Rising Rate ETF -56.50%
BNKD MicroSectors U.S. Big Banks Index -3X Inverse Leveraged ETN -51.70%
BNKZ MicroSectors U.S. Big Banks Index -2x Inverse Leveraged ETN -51.12%
KNAB MicroSectors U.S. Big Banks Index Inverse ETN -50.55%
EFZ ProShares Short MSCI EAFE -48.42%

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