Megaphone icon ETF Database is now VettaFi. Read More >
ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • Entrepreneur ETF
    • Equity ETF
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Future ETFs
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Modern Alpha
    • Multi-Asset
    • Multi-Factor
    • Nasdaq Investment Intelligence
    • Portfolio Strategies
    • Retirement Income
    • Smart Beta
    • Thematic Investing
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Videos & Podcasts
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Leveraged & Inverse ETF Channel
  2. Need Stability in Your Stocks? Consider the Utilities Industry
Leveraged & Inverse ETF Channel
Share

Need Stability in Your Stocks? Consider the Utilities Industry

Ben HernandezJun 16, 2021
2021-06-16

Pandemic or no pandemic, utilities will always be in demand, and traders can capitalize on the consistency with the Direxion Daily Utilities Bull 3X Shares (UTSL).

While leveraged funds are typically reserved for experienced investors, utilities might be ideal for intermediate traders looking to dabble in 3x ETFs to maximize gains. Utility equities can provide a level of stability that other sectors may not experience, particularly when a market downturn takes place.

“Utility stocks may not be known for huge gains, but they seldom see big losses,” an Investorplace article said. “They lack the volatility of other stocks. Even in a bad economy, people still need utilities; unlike companies that depend on discretionary consumer spending, which may see their revenue plummet.”

“Utilities are also relatively safe from competition,” the article said further. “With the large infrastructure investment required, the cost of entry for newcomers is prohibitively high. Utilities may also be protected from competitors by government regulations.”

As for the fund, UTSL seeks daily investment results, before fees and expenses, of 300% of the daily performance of the Utilities Select Sector Index. The fund invests at least 80% of its net assets (plus borrowing for investment purposes) in financial instruments, such as swap agreements, securities of the index, ETFs that track the index, and other financial instruments that provide daily leveraged exposure to the index or ETFs that track the index.

UTSL Price % Change

An Energized Portfolio

The energy sector has been one of the big winners in 2021, largely powered by a rebound in oil prices. In addition, renewable energy sources are seeing higher demand, which is helping UTSL’s top holding (about 17% of the index UTSL tracks), NextEra Energy.

The company primarily focuses on wind and solar energy, which is getting a boost from the federal government as the U.S. continues to work towards reducing its carbon footprint. Expect renewable sources of energy to continue become a larger piece of the utilities pie.

“In 2020, large-scale solar and wind power generated about 11% of the electricity in the United States, and that share is expected to keep growing,” a Pew Research Center article noted. “The Biden administration just approved the country’s first major offshore wind farm and intends to invest in additional offshore wind projects. And construction costs for solar and wind power projects fell dramatically from 2013 to 2018, helping to boost the viability of increased reliance on these sources.”


Content continues below advertisement

NextEra Price % Change

For more news and information, visit the Leveraged & Inverse Channel.

Loading Articles...
Help & Info
  • Contact Us
  • Mission Statement
  • Press
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © ETF Flows LLC
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X