Direxion Sets Share Splits On Five ETFs

April 23, 2010

Direxion, the Newton, Mass.-based company known for its triple-exposure bull-and-bear ETFs, plans share splits on five of its ETFs in response to prices that have climbed above what the company considers their optimal range to attract trading.

The company plans a four-for-one split of its Daily Emerging Markets Bull 3x Shares (NYSEArca: EDC), its Daily Real Estate Bull 3x Shares (NYSEArca: DRN) and the Daily Technology Bull 3x Shares (NYSEArca: TYH). It will also set three-for-one splits on its Daily Financial Bull 3x Shares (NYSEArca: FAS) and the Daily Mid Cap Bull 3x Shares (NYSEArca: MWJ).

“There isn’t a set range, but we just find a lot of folks prefer to see a price that’s in that $30 to $80 or $90 range,” said Andy O’Rourke, Direxion’s director of marketing. “We want to stay within that,” O’Rourke said.

The splits come at a time when the U.S. equity market is about six weeks into the second year of a rebound in after prices bottomed in March 2009. The S&P 500 Index of the biggest U.S. companies has gained almost 70 percent since then.

The split will be effective on May 4, to shareholders who hold the shares by the close of business on April 30.

Direxion split the bearish version of its emerging markets ETF in March to address a slide in price that had wiped out almost all of the fund’s value.

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