Before the start of 2025, AI stocks were soaring en route to resuming their rally. Things have obviously changed given a pair of Direxion leveraged/inverse ETFs switching spots.
Rising volatility from the tariff tantrum saw AI stocks start to drop off precipitously as sell-offs accelerated through the first week of April. At the same time, the Cboe Volatility Index (VIX) pushed higher as seen below. Traders might be looking for an entry point amid the sell-offs, but don’t want to catch the proverbial falling knife. The positive news is that volatility has been subsiding, which could mark a potential inflection point.
If traders sense a bottom may be close, they may want to take a chance on the Direxion Daily AI and Big Data Bull 2X Shares (AIBU ). It provides 200% exposure to the performance of the Solactive US AI & Big Data Index. It represents the securities of companies domiciled in the United States that have business operations in the field of AI applications and big data.
If AI stocks continue to exhibit weakness, at least in the short-term horizon, then traders can also use the Direxion Daily AI and Big Data Bear 2X Shares (AIBD ). Having this ability to take the bearish side of the trade allows for flexibility in the markets regardless of whether the AI subsector is trending higher or lower.
The volatility markets have been experiencing is clearly evident in the direction of both funds. AI stocks appeared to continue trending higher, pushing AIBU up before the sell-off began and then accelerated by the end of February. This, in turn, saw AIBU overtake AIBD for a year-to-date gain of over 20% just before Good Friday, April 18. With a tariff pause, these two funds could switch places once again in the coming weeks.
Single-Stock ETF Options
Under the hood of both funds, traders will see familiar names: Apple, Meta, Microsoft, Amazon, and Alphabet. That said, this also creates bull/bear opportunities in single-stock ETFs if traders wish to leverage their bullish bets or take the bearish side:
- Apple: +Direxion Daily AAPL Bull 2X+ (AAPU )/ Direxion Daily AAPL Bear 1X Shares (AAPD )
- Meta: Direxion Daily META Bull 2X Shares (METU )/ Direxion Daily META Bear 1X Shares (METD )
- Microsoft: Direxion Daily MSFT Bull 2X Shares (MSFU )/ Direxion Daily MSFT Bear 1X Shares (MSFD )
- Amazon: Direxion Daily AMZN Bull 2X Shares (AMZU )/ Direxion Daily AMZN Bear 1X Shares (AMZD )
- Google/Alphabet: Direxion Daily GOOGL Bull 2X Shares (GGLL )/ Direxion Daily GOOGL Bear 1X Shares (GGLS )
For more news, information, and analysis, visit the Leveraged & Inverse Channel.
