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 86 ETFs traded on the U.S. markets, Inverse ETFs have total assets under management of $12.53B. The average expense ratio is 1.02%. Inverse ETFs can be found in the following asset classes:

  • Equity
  • Fixed Income
  • Commodities
  • Alternatives

The largest Inverse ETF is the ProShares UltraPro Short QQQ SQQQ with $1.79B in assets. In the last trailing year, the best-performing Inverse ETF was SVXY at 59.61%. The most recent ETF launched in the Inverse space was the MicroSectors FANG & Innovation -3x Inverse Leveraged ETN BERZ on 08/17/21.

Top ETF Performers

BZQ ProShares UltraShort MSCI Brazil Capped 9.20%
BNKD MicroSectors U.S. Big Banks Index -3X Inverse Leveraged ETN 6.65%
SMN ProShares UltraShort Basic Materials 6.35%
SDOW ProShares UltraPro Short Dow30 4.65%
YANG Direxion Daily FTSE China Bear 3X Shares 4.55%

Bottom ETF Performers

KOLD ProShares UltraShort Bloomberg Natural Gas -52.75%
DRIP Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 2X Shares -24.77%
LABD Direxion Daily S&P Biotech Bear 3X Shares -16.57%
EWV ProShares UltraShort MSCI Japan -15.01%
SCO ProShares UltraShort Bloomberg Crude Oil -13.58%

Top Creations

SQQQ ProShares UltraPro Short QQQ 130.25
SPXU ProShares UltraPro Short S&P500 125.14
TZA Direxion Daily Small Cap Bear 3X Shares 124.81
TBT ProShares UltraShort 20+ Year Treasury 66.46
SDS ProShares UltraShort S&P500 65.34

Top Redemptions

SVXY ProShares Short VIX Short-Term Futures ETF -80.29
JDST Direxion Daily Junior Gold Miners Index Bear 2X Shares -7.81
GLL ProShares UltraShort Gold -4.87
SCO ProShares UltraShort Bloomberg Crude Oil -2.82
EFZ ProShares Short MSCI EAFE -2.68

AUM Winners

SIJ ProShares UltraShort Industrials 89.92%
WEBS Direxion Daily Dow Jones Internet Bear 3X Shares 60.88%
LABD Direxion Daily S&P Biotech Bear 3X Shares 52.97%
EUM ProShares Short MSCI Emerging Markets 48.10%
KOLD ProShares UltraShort Bloomberg Natural Gas 42.40%

AUM Losers

DDG ProShares Short Oil & Gas -38.32%
EDZ Direxion Daily MSCI Emerging Markets Bear 3x Shares -31.06%
ERY Direxion Daily Energy Bear 2X Shares -24.72%
EFZ ProShares Short MSCI EAFE -22.62%
SVXY ProShares Short VIX Short-Term Futures ETF -15.98%

Daily ETF Watch

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ETF Odds & Ends: JPMorgan Adds 2 ActiveBuilders

While launches were strong last week, other ETF-related actions were few and far between.

Daily ETF Watch

ETF Odds & Ends: JPMorgan Adds 2 ActiveBuilders

While launches were strong last week, other ETF-related actions were few and far between.

Daily ETF Watch

ETFMG Offering Leveraged ETFs

The three funds are tied to the same indexes as some of ETF Managers Group’s existing ETFs.

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Daily ETF Watch

ETF Odds & Ends: 23 ProShares To Split

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Daily ETF Watch

ETF Odds & Ends: 1st Schwab Launch Since 2019

Plus, a number of index changes occurred last week.

Daily ETF Watch

ETF Odds & Ends: MicroSectors, iShares Split

Also, a host of changes to ETF names, indexes and tickers. 

Daily ETF Watch

ETF Odds & Ends: IAU Share Split & More

The last two weeks saw a lot of activity in the ETF space.