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 116 ETFs traded in the U.S. markets, Inverse ETFs gather total assets under management of $11.30B. The average expense ratio is 1.04%. Inverse ETFs can be found in the following asset classes:

  • Equity
  • Alternatives
  • Commodities
  • Fixed Income

The largest Inverse ETF is the ProShares Short S&P500 SH with $1.74B in assets. In the last trailing year, the best performing Inverse ETF was the DGAZ at 224.38%. The most-recent ETF launched in the Inverse space was the Direxion Daily S&P 500 High Beta Bear 3X Shares HIBS in 11/07/19.

Top ETF Performers

DGAZ VelocityShares 3X Inverse Natural Gas ETN 60.32%
KOLD ProShares UltraShort Bloomberg Natural Gas 34.17%
DRIP Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 3X Shares 28.56%
GASX Direxion Daily Natural Gas Related Bear 3X Shares 28.10%
DWT VelocityShares 3x Inverse Crude Oil ETN 16.85%

Bottom ETF Performers

JDST Direxion Daily Junior Gold Miners Index Bear 3X Shares -25.98%
FNGD MicroSectors FANG+ Index -3X Inverse Leveraged ETN -25.13%
DUST Direxion Daily Gold Miners Index Bear 3x Shares -20.72%
TECS Direxion Daily Technology Bear 3X Shares -19.14%
RUSS Direxion Daily Russia Bear 3x Shares -18.67%

Top Creations

DWT VelocityShares 3x Inverse Crude Oil ETN 97.40
LABD Direxion Daily S&P Biotech Bear 3X Shares 67.87
DUST Direxion Daily Gold Miners Index Bear 3x Shares 62.46
JDST Direxion Daily Junior Gold Miners Index Bear 3X Shares 54.76
DRIP Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 3X Shares 44.41

Top Redemptions

SH ProShares Short S&P500 -123.41
DGAZ VelocityShares 3X Inverse Natural Gas ETN -73.92
SQQQ ProShares UltraPro Short QQQ -20.68
RWM ProShares Short Russell2000 -20.28
TZA Direxion Daily Small Cap Bear 3X Shares -12.47

AUM Winners

FNGD MicroSectors FANG+ Index -3X Inverse Leveraged ETN 139.14%
GASX Direxion Daily Natural Gas Related Bear 3X Shares 62.99%
WTID UBS ETRACS - ProShares Daily 3x Inverse Crude ETN 37.68%
KOLD ProShares UltraShort Bloomberg Natural Gas 27.51%
SVXY ProShares Short VIX Short-Term Futures ETF 22.88%

AUM Losers

MIDZ Direxion Daily Mid Cap Bear 3X Shares -47.42%
TYBS Direxion Daily 20+ Year Treasury Bear 1X Shares -34.36%
SBM ProShares Short Basic Materials -33.86%
SPDN Direxion Daily S&P 500 Bear 1X Shares -32.84%
EUM ProShares Short MSCI Emerging Markets -26.25%

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