Direxion Launches Leveraged Russia, Agribusiness ETFs

by on May 25, 2011 | Updated April 25, 2013 | ETFs Mentioned:

Direxion rolled out the latest additions to its lineup of leveraged and inverse ETFs today, introducing products that offer 3x daily exposure to Russian equities and the global agribusiness sector. The new ETFs include:

  • Daily Russia Bull 3x Shares (RUSL)
  • Daily Russia Bear 3x Shares (RUSS)
  • Daily Agribusiness Bull 3x Shares (COWL)
  • Daily Agribusiness Bear 3x Shares (COWS)

The Russia ETFs seek to deliver daily results that correspond to multiples of the daily change in the DAXglobal Russia+ Index. That benchmark serves as the basis for the Market Vectors Russia ETF (RSX), one of four U.S.-listed products offering exposure to the Russian stock market. Those funds have aggregate assets of more than $3 billion, the majority of which is attributable to RSX.

The underlying index consists of about 45 Russian stocks, most of which are large cap companies. Not surprisingly, the energy sector accounts for a significant chunk of the underlying portfolio, making up close to 40% of the index. Russia’s entire economy is dependent on energy prices, as revenues related to oil and gas account for a large portion of GDP. As such, Russian equities often exhibit significant volatility, making the 3x Russia ETFs potentially attractive tools for those looking to capitalize on short-term pricing discrepancies [see Small Cap Russia ETF Offers Unique Exposure].

MOO x 3 (and -3)

The leveraged agribusiness ETFs are both linked to the DAXglobal Agribusiness Index, the benchmark underlying the popular Market Vectors Agribusiness ETF (MOO). That fund is one of four agribusiness ETFs offering exposure to companies engaged in the production of agricultural chemicals, agricultural equipment, and agriproduct operations. The underlying index consists of about 45 companies, with the largest weightings going to Potash Corp of Saskatchewan, Monsanto, The Mosaic Company, and Deere & Company. Again, these new Direxion products are linked to an index that has proven to be popular with investors; MOO has about $4.5 billion in assets, making it the second largest fund in the Commodity Producers Equities ETFdb Category.

“Our new leveraged ETFs are the latest in Direxion’s growing line of tactical trading funds offering magnified benchmark exposure for investors who actively manage their trading positions,” said Direxion President Dan O’Neill. “The funds’ launch reinforces Direxion’s commitment to providing innovative investment products that enable sophisticated investors to take advantage of short-term market opportunities as part of their overall investment strategies.”

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Disclosure: No positions at time of writing.