6 Leveraged ETFs Up More Than 50% Midway Q1

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Stock markets across the globe have been on a stellar ride so far this year buoyed by renewed optimism over speedy economic recovery from the pandemic-driven recession. This is especially true given hopes of further U.S. stimulus package, signs of a healing labor market, continued progress in more vaccines, rapid vaccination rollout, and better-than-expected earnings.

The combination of all these factors will lead to pent-up demand, resulting in higher demand for all types of products and services in the economy. However, surging Treasury yields and growing inflationary pressure have been bothering investors lately.

This has resulted in huge demand for leveraged ETFs as investors seek to register big gains in a short span. Leveraged funds provide multiple exposure (2X or 3X) to the daily performance of the underlying index by employing various investment strategies such as swaps, futures contracts, and other derivative instruments. Due to their compounding effect, investors can enjoy higher returns in a very short period of time, provided the trend remains positive.

While most of the corners of the global stock market are enjoying ascent, we highlight six best-performing leveraged equity ETFs that piled up more than 50% gains through midway Q1. These funds will continue to be investors’ darlings provided the sentiments remain bullish.

MicroSectors U.S. Big Oil Index 3X Leveraged ETN (NRGU - Free Report) – Up 84.3%

This ETN provides three times leveraged exposure to the Solactive MicroSectors U.S. Big Oil Index, which is equal-dollar weighted and provides exposure to the 10 largest U.S. energy and oil companies. It has been able to manage $392.3 million in its asset base while trading in an average daily volume of 409,000 shares. Expense ratio comes in at 0.95%.

Direxion Daily Regional Banks Bull 3x Shares (DPST - Free Report) – Up 76.4%

This fund seeks to deliver three times the returns of the S&P Regional Banks Select Industry Index, charging 95 bps in fees per year. It has accumulated $298.5 million in its asset base and trades in an average daily volume of around 320,000 shares.

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