Why Investors Are Dumping TQQQ & SOXL Despite Huge Gains
Despite surging this year, the two biggest leveraged ETFs have seen a combined $14 billion in outflows.
Investors are pulling billions of dollars out of the two biggest leveraged ETFs even as both funds post stellar returns in 2025.
The ProShares UltraPro QQQ (TQQQ) and the Direxion Daily Semiconductor Bull 3x Shares (SOXL) have seen outflows of $7 billion and $6.9 billion, respectively, so far this year—the fifth- and sixth-largest redemptions among all U.S.-listed ETFs.
Despite the selling, both remain giants in the leveraged ETF world. TQQQ currently holds $29.1 billion in assets, while SOXL manages $13.9 billion, making them the largest and second-largest leveraged ETFs in the U.S. Combined, they represent roughly a quarter of the $170 billion invested across all leveraged products.
Their size also explains why leveraged ETFs as a group show net outflows of about $1.5 billion this year. Excluding TQQQ and SOXL, the rest of the category has actually pulled in $12.5 billion of inflows.
Strong Returns, Heavy Redemptions
The withdrawals are striking because both funds have performed well—at least on the surface. TQQQ is up 37% year-to-date, while SOXL has surged 53%, outpacing their non-leveraged counterparts. The Invesco QQQ Trust (QQQ) has gained 20%, and the iShares Semiconductor ETF (SOXX) has risen 35%.
But despite the impressive headline numbers, both funds have delivered less than triple the year’s index gains. TQQQ has delivered roughly 1.9x the return of QQQ, while SOXL has delivered 1.5x SOXX.
The shortfall reflects the effects of daily rebalancing and the financing costs that erode long-term performance in leveraged ETFs.
It’s plausible that some investors, disappointed by the shortfall relative to expectations, have been selling as a result.
Profit-Taking After the Comeback
Another explanation for the outflows is simple profit-taking. After brutal losses in 2022, investors piled into TQQQ and SOXL. Now those same investors may be locking in gains as the funds recover.
During the 2021–2022 market downturn, TQQQ plunged 82% peak-to-trough and SOXL collapsed 91% as rising interest rates crushed tech stocks.
In 2022, TQQQ took in $11.4 billion of inflows and SOXL added $6.1 billion. Since then, money has steadily flowed back out. TQQQ saw redemptions of $6.1 billion in both 2023 and 2024, followed by another $7 billion so far in 2025. 
Source: Bloomberg
SOXL experienced a similar pattern, with $3 billion of outflows in 2023, a modest $834 million of inflows in 2024, and $6.9 billion of redemptions this year.
Volatility Cuts Both Ways
The extreme price swings these ETFs have seen in recent years underscore just how volatile leveraged products can be. While SOXL’s 2025 surge has been impressive, it followed an 88% decline from its 2024 high to its 2025 low—its second near-90% drop in less than four years.
TQQQ’s most recent drawdown was milder at 58%, but still punishing for investors caught on the wrong side of the move.
Such volatility makes timing critical. Traders who miss the window to sell when prices are high can face devastating losses, even in leveraged ETFs tied to booming sectors.
Used by More Than Just Retail Traders
Of course, not everyone uses these ETFs simply to make directional bets. Some investors employ them to hedge other positions in the tech or semiconductor space, or as part of more complex strategies run by hedge funds and other investors.
Another factor for the outflows could be competition from single-stock leveraged ETFs, which debuted in 2022—the same year TQQQ and SOXL last saw large inflows.
These ETFs, which offer magnified exposure to names like Nvidia, Tesla, and Apple, have since accumulated $31.5 billion in assets. The growing menu of single stock leveraged ETFs may be drawing traders away from index-based products like TQQQ and SOXL.
