Daily ETF Watch: Direxion Debuts 2X Funds

Today Direxion launched two new bull/bear pairs of inverse and leveraged ETFs. The four funds offer geared exposure to the cybersecurity and pharmaceutical spaces.

The funds, their tickers and expense ratios are as follows:

• Direxion Daily Cyber Security Bull 2X Shares (HAKK), 0.99 percent
• Direxion Daily Cyber Security Bear 2X Shares (HAKD), 0.80 percent
• Direxion Daily Pharmaceutical & Medical Bull 2X Shares (PILL), 0.95 percent
• Direxion Daily Pharmaceutical & Medical Bear 2X Shares (PILS), 0.80 percent

HAKK and HAKD are both tied to the performance of the ISE Cyber Security Index, which is the same index underlying the $1.1 billion PureFunds ISE Cyber Security ETF (HACK | C-31). Meanwhile, PILL and PILS share an index with the $1.9 billion PowerShares Dynamic Pharmaceuticals Portfolio (PJP | B-84), the Dynamic Intellidex Pharmaceuticals Index.

Both funds represent niches that have been very popular with investors in recent months. HACK, in particular, has grown rapidly since its launch last November.

Oil-Free S&P 500 SPDR Fund

State Street Global Advisors has filed for an ETF that complements its SPDR MSCI ACWI Low Carbon Target ETF (LOWC | D-95), which it launched in November 2014. The SPDR S&P 500 Fossil Fuel Free ETF will track a version of the S&P 500 that excludes companies owning fossil fuel reserves.

The fund’s index provider will rely on publicly available information to determine firms’ ownership of fossil fuel assets for purposes of third-party or in-house energy production, according to the prospectus. Such assets include crude oil, natural gas and thermal coal.

The prospectus notes that as of the end of July, the ETF’s underlying index included 468 components.

Presumably, the fund’s benchmark will all but exclude the entire energy sector, which is one of the smaller sectors in the S&P 500 currently. According to the S&P Dow Jones Indices website, energy represents a little more than 7 percent of the total index, considerably smaller than the Information technology sector, which is the largest sector, at 20 percent of the index.

The approach taken by the fund will be somewhat different from that taken by LOWC, which does not exclude any companies in its benchmark’s parent index, the MSCI ACWI. Ratherm it overweights companies that have lower carbon emissions, and underweights those with higher emissions.

The filing did not include an expense ratio, but it did indicate the fund would list on the NYSE Arca and trade under the ticker SPYX.

Contact Heather Bell at [email protected].