On Wednesday, Direxion expanded its suite of leveraged and inverse ETF products with the launch of four new funds.
Each of the new Direxion ETFs offers leveraged or inverse exposure to a single stock’s daily price performance. All four of the funds have net expense ratios of 97 basis points.
Two of the new funds look at the daily stock performance for Eli Lily (LLY). The Direxion Daily Bull 2X Shares (ELIL) looks to generate 2x of LLY’s daily returns. Meanwhile, the Direxion Daily LLY Bear 1X Shares (ELIS) offers -100% of the stock’s daily price performance.
Investors focused on the cybersecurity sector may find the other two Direxion ETFs interesting. The Direxion Daily PANW Bull 2X Shares (PALU) offers a bullish take on Palo Alto Networks (PANW) daily stock movements. Alternatively, the Direxion Daily PANW Bear 1X Share (PALD) instead opts for inverse exposure.
These leveraged and inverse ETFs use swap agreements and options to generate their daily exposure to a single stock. Generally speaking, all four funds will attempt to execute on their investment strategies regardless of how the individual stocks or greater market are performing.
Advantages of Exposure
Both cybersecurity and healthcare have proven to be sectors that investors are interested in gaining more exposure to. As such, these funds can serve as efficient tools for gaining short-term access to concentrated stock performance.
“We see headlines that are impacting either the pharmaceutical or cybersecurity sectors, whether it be changes in the government stance around healthcare, or changes in tariffs that are impacting AI or cybersecurity,” said Douglas Yones, CEO of Direxion. “Eli Lilly and Palo Alto Networks are the types of companies that move around quite a bit, the ones that our traders look to us to provide leveraged and inverse strategies on.”
See More: Douglas Yones on Direxion’s Lineup & ETF Education at Exchange
Given the daily nature of their investment objectives, these funds can offer both high reward and high risk. As such, investors and advisors may want to research the advantages of leveraged and inverse funds before pursuing direct investment.
These new funds join Direxion’s ever-growing network of competitive leveraged & inverse funds. For instance, one of the largest Direxion ETFs, the Direxion Daily 20+ Year Treasury Bull 3X Shares (TMF ), has well over $5 billion in assets under management.
For more news, information, and analysis, visit the Leveraged & Inverse Channel.
