Leveraged ETF Overview

Leveraged ETFs are powerful and complex trading instruments that allow traders to magnify the return on investment. While higher returns are an attractive proposition, investors need to realize that losses are magnified too. Thus, these ETFs need to be handled with care.

Leveraged ETFs deliver the desired returns over prespecified periods only (usually one day). A leveraged ETF that offers 2x exposure to the S&P 500 only attempts to do so over one-day holding periods. Investors looking to hold these ETFs for significantly longer time periods can often find themselves losing money even if the underlying benchmark behaved as expected.

With 150 ETFs traded in the U.S. markets, Leveraged ETFs gather total assets under management of $32.90B. The average expense ratio is 1.16%. Leveraged ETFs can be found in the following asset classes:

  • Equity
  • Fixed Income
  • Currency
  • Commodities
  • Asset Allocation
  • Alternatives

The largest Leveraged ETF is the ProShares UltraPro QQQ TQQQ with $3.96B in assets. In the last trailing year, the best performing Leveraged ETF was the UVXY at 320.50%. The most-recent ETF launched in the Leveraged space was the ETRACS Monthly Pay 2xLeveraged US Small Cap High Dividend ETN SMHB in 11/08/18.

TOP ETF PERFORMERS

UGAZ VelocityShares 3X Long Natural Gas ETN 107.98%
BOIL ProShares Ultra Bloomberg Natural Gas 78.70%
INDL Direxion Daily MSCI India Bull 3x Shares 42.97%
NAIL Direxion Daily Homebuilders & Supplies Bull 3X Shares 25.56%
EDC Direxion Daily MSCI Emerging Markets Bull 3x Shares 23.69%

BOTTOM ETF PERFORMERS

UWT VelocityShares 3x Long Crude Oil ETN -57.46%
OILU ProShares UltraPro 3x Crude Oil ETF -57.39%
WTIU UBS ETRACS - ProShares Daily 3x Long Crude ETN -57.35%
USOU United States 3x Oil Fund -57.07%
UCO ProShares Ultra Bloomberg Crude Oil -42.03%

TOP CREATIONS

TQQQ ProShares UltraPro QQQ 1.34K
LABU Direxion Daily S&P Biotech Bull 3X Shares 433.57
TNA Direxion Daily Small Cap Bull 3x Shares 386.01
SPXL Direxion Daily S&P 500 Bull 3x Shares 262.71
UPRO ProShares UltraPro S&P500 235.41

TOP REDEMPTIONS

UVXY ProShares Ultra VIX Short-Term Futures ETF -341.79
TVIX VelocityShares Daily 2x VIX Short-Term ETN -102.91
BRZU Direxion Daily MSCI Brazil Bull 3X Shares -79.95
JNUG Direxion Daily Junior Gold Miners Index Bull 3X Shares -75.79
NUGT Direxion Daily Gold Miners Index Bull 3x Shares -42.18

AUM WINNERS

HOML ETRACS Monthly Reset 2xLeveraged ISE Exclusively Homebuilders ETN 143.17%
UGAZ VelocityShares 3X Long Natural Gas ETN 120.67%
MEXX Direxion Daily MSCI Mexico Bull 3X Shares 102.00%
UST ProShares Ultra 7-10 Year Treasury 57.86%
KORU Direxion Daily MSCI South Korea Bull 3X Shares 57.34%

AUM LOSERS

TVIX VelocityShares Daily 2x VIX Short-Term ETN -43.53%
WTIU UBS ETRACS - ProShares Daily 3x Long Crude ETN -43.16%
UBR ProShares Ultra MSCI Brazil Capped -34.58%
UVXY ProShares Ultra VIX Short-Term Futures ETF -33.75%
UTSL Direxion Daily Utilities Bull 3X Shares -31.42%

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