Direxion adds airlines ETF, the firm's first nonleveraged fund.
Direxion, the Newton, Mass.-based firm known for its leveraged and inverse exchange-traded funds, launched its first nonleveraged fund today, a fund focused on airlines. The company hopes the air-travel pocket of the ETF world is still covered thinly enough to be prospective.
The Direxion Airline Shares ETF (NYSEArca: FLYX) is based on the NYSE Arca Airline Index and has an expense ratio of 0.55 percent. It will compete with the Guggenheim Arca Airline ETF (NYSEArca: FAA), a fund based on the NYSE Arca Global Airlines Index, that costs investors 0.65 percent a year.
“It’s not that we’re looking to compete with 1X shops, we just saw an opportunity to fill a space that’s not very filled up,” Andy O’Rourke, Direxion’s director of marketing, said in a telephone interview.
The price of FAA, the Guggenheim ETF, has risen about 33 percent this year. It has gathered almost $39 million in assets since its launch in January 2009.
Gold Funds Launch
Separately, Direxion today also launched a bull-and-bear pair of double-exposure ETFs focused on gold miners, jumping into a piece of the investment universe that is quite popular amid concerns that the Federal Reserve’s monetary policy will debase the dollar.
The Direxion Daily Gold Miners Bull 2x Shares (NYSEArca: NUGT) and the Direxion Daily Gold Miners Bear 2x Shares (NYSEArca: DUST) are based the NYSE Arca Gold Miners Index, and both have annual expense ratios of 0.95 percent, the price it charges on all its inverse and leveraged products.