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 102 ETFs traded in the U.S. markets, Inverse ETFs gather total assets under management of $19.76B. The average expense ratio is 1.02%. 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 $4.12B in assets. In the last trailing year, the best performing Inverse ETF was the DRIP at 384.39%. 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

SRS ProShares UltraShort Real Estate 25.61%
SDD ProShares UltraShort SmallCap600 20.50%
TWM ProShares UltraShort Russell2000 19.21%
REK ProShares Short Real Estate 16.87%
EMTY ProShares Decline of the Retail Store ETF 15.89%

Bottom ETF Performers

TAPR Barclays Inverse U.S. Treasury Composite ETN -96.57%
JDST Direxion Daily Junior Gold Miners Index Bear 2X Shares -78.26%
DUST Direxion Daily Gold Miners Index Bear 2x Shares -51.81%
SOXS Direxion Daily Semiconductor Bear 3X Shares -42.75%
ZIV VelocityShares Daily Inverse VIX Medium-Term ETN -42.16%

Top Creations

SH ProShares Short S&P500 1.11K
SVXY ProShares Short VIX Short-Term Futures ETF 687.27
SPXU ProShares UltraPro Short S&P500 656.54
SDOW ProShares UltraPro Short Dow30 556.16
SPXS Direxion Daily S&P 500 Bear 3X Shares 380.62

Top Redemptions

DUST Direxion Daily Gold Miners Index Bear 2x Shares -271.93
PSQ ProShares Short QQQ -180.04
LABD Direxion Daily S&P Biotech Bear 3X Shares -126.95
DRIP Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 2X Shares -92.53
TZA Direxion Daily Small Cap Bear 3X Shares -88.66

AUM Winners

SMDD ProShares UltraPro Short MidCap400 281.71%
EMTY ProShares Decline of the Retail Store ETF 268.54%
SPDN Direxion Daily S&P 500 Bear 1X Shares 240.73%
MYY ProShares Short MidCap400 223.44%
REK ProShares Short Real Estate 199.26%

AUM Losers

DTO DB Crude Oil Double Short ETN -62.00%
DUST Direxion Daily Gold Miners Index Bear 2x Shares -53.51%
LABD Direxion Daily S&P Biotech Bear 3X Shares -48.06%
YANG Direxion Daily FTSE China Bear 3X Shares -43.06%
DRIP Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 2X Shares -42.79%

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