Today, Direxion rolled out the first ETF to offer leveraged exposure to FANG stocks. The Direxion Daily Select Large Caps & FANGs Bull 2X Shares (FNGG) is notable because REX MicroSectors has been the main provider of leveraged and inverse access to that space via the exchange-traded note (ETN) wrapper.
FNGG comes with an expense ratio of 1.07% and lists on the NYSE Arca.
The new fund offers 200% exposure to the ICE FANG 20 Index, which includes securities such as Facebook, Apple, Amazon, Netflix, Google and Microsoft, as well as companies with similar characteristics.
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"FNGG allows traders to take a bold position in a basket of 20 well-known, highly traded growth stocks across the technology, media & communications and consumer discretionary sectors,” said Direxion Head of Product David Mazza in a press release.
Top components in the index are a bit surprising given that they do not include any of the best-known FANG stocks. The top three holdings in the index at the time of the fund’s launch were Sea (5.86%), Palantir Technologies (5.8%) and NVIDIA (5.49%). Netflix claimed the No. 5 spot in the index, while Google parent Alphabet ranked eighth.
There are eight MicroSectors ETNs tracking the FANG-related space that provide up to 300%/-300% leveraged and inverse exposure, as well unleveraged long exposure. The largest of these is the $1.9 billion MicroSectors FANG+ Index 3X Leveraged ETN (FNGU). FNGU also happens to be the second-largest ETN currently trading in the U.S.
Contact Heather Bell at [email protected]