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 100 ETFs traded in the U.S. markets, Inverse ETFs gather total assets under management of $15.47B. The average expense ratio is 1.01%. Inverse ETFs can be found in the following asset classes:

  • Fixed Income
  • Equity
  • Commodities
  • Alternatives

The largest Inverse ETF is the ProShares Short S&P500 SH with $3.20B in assets. In the last trailing year, the best performing Inverse ETF was the DGAZ at 216.44%. The most-recent ETF launched in the Inverse space was the iPath Series B US Treasury 10-year Bear ETN BTYS in 02/04/20.

Top ETF Performers

NRGD MicroSectors U.S. Big Oil Index -3X Inverse Leveraged ETN 45.28%
DRIP Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 2X Shares 40.71%
ERY Direxion Daily Energy Bear 2X Shares 32.38%
NRGZ MicroSectors U.S. Big Oil Index -2X Inverse Leveraged ETN 31.63%
DUG ProShares UltraShort Oil & Gas 31.33%

Bottom ETF Performers

FNGD MicroSectors FANG+ Index -3X Inverse Leveraged ETN -39.68%
LABD Direxion Daily S&P Biotech Bear 3X Shares -28.89%
YANG Direxion Daily FTSE China Bear 3X Shares -28.45%
FNGZ MicroSectors FANG+ Index -2x Inverse Leveraged ETN -27.64%
WEBS Direxion Daily Dow Jones Internet Bear 3X Shares -26.66%

Top Creations

SQQQ ProShares UltraPro Short QQQ 225.94
RWM ProShares Short Russell2000 71.20
SRTY ProShares UltraPro Short Russell2000 59.78
PSQ ProShares Short QQQ 45.60
TZA Direxion Daily Small Cap Bear 3X Shares 43.39

Top Redemptions

SH ProShares Short S&P500 -262.05
DGAZ VelocityShares 3X Inverse Natural Gas ETN -159.33
SPXU ProShares UltraPro Short S&P500 -77.87
SPXS Direxion Daily S&P 500 Bear 3X Shares -55.95
SVXY ProShares Short VIX Short-Term Futures ETF -30.18

AUM Winners

KOLD ProShares UltraShort Bloomberg Natural Gas 271.34%
HIBS Direxion Daily S&P 500 High Beta Bear 3X Shares 169.99%
FNGD MicroSectors FANG+ Index -3X Inverse Leveraged ETN 93.75%
DDG ProShares Short Oil & Gas 82.11%
SMDD ProShares UltraPro Short MidCap400 74.79%

AUM Losers

TTT ProShares UltraPro Short 20+ Year Treasury -30.44%
FNGZ MicroSectors FANG+ Index -2x Inverse Leveraged ETN -28.91%
SOXS Direxion Daily Semiconductor Bear 3X Shares -22.51%
TAPR Barclays Inverse U.S. Treasury Composite ETN -21.89%
SCC ProShares UltraShort Consumer Services -20.64%

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