First a housekeeping item. The ETF being discussed here is a leveraged fund, meaning it should not be held over the duration of 2026. However, there will be ample opportunities to trade this fund on a tactical, short-term basis. Without further ado, the ETF in question is the Direxion Daily AVGO Bull 2X (AVL ). AVL is designed to deliver 200% of the daily returns of Broadcom (AVGO) — a semiconductor maker with clear ties to the artificial intelligence (AI) trade.
Traders that properly used AVL handsomely rewarded traders who used it properly in 2025. Indeed, Broadcom was one of the best-performing mega-cap tech stocks.
Broadcom is just a few weeks removed from delivering strong fiscal fourth-quarter results. It impressed investors by unveiling an $11 billion AI chip order from Anthropic and another unidentified chip customer. That portends plenty of chances with which to make short-term use of AVL as this year unfolds.
AVL Has Makings of 2026 Winner
Broadcom’s various earnings dates and the possibility of product announcements will make for opportune times to engage with AVL. The added good news for risk-tolerant traders: other fundamental catalysts could spur opportunity with this geared ETF.
“In our view, Broadcom’s networking chip business is its strongest and contributes heavily to the company’s wide economic moat,” noted Morningstar’s William Kerwin. “We expect it to retain a dominant position in merchant silicon for switching and routing applications, where we see it as best-of-breed for high speeds. We also expect it to hold a formidable position in custom artificial intelligence accelerators as it benefits from hyperscale cloud vendors building chips to reduce their reliance on Nvidia.”
Not surprisingly, AI is a significant part of the Broadcom investment thesis, signaling that related headlines could also bring chances to amplify gains with Direxion’s AVL. It’s possible, if not likely, several such occasions will arise over the course of 2026.
“We expect Broadcom to grow rapidly as a result of its skyrocketing AI chip business. We believe AI is already the primary driver of Broadcom’s chip sales and is becoming the firm’s overall leading growth driver. Outside of AI, we see more moderate growth led by VMware and wireless chip sales to Apple,” added Kerwin.
Progress on debt reduction and buybacks could also be fundamental catalysts sparking AVL at times this year.
“We see it as appropriately deleveraged exiting fiscal 2025 to begin considering further acquisitions, but anticipate a focus on debt reduction and share buybacks in fiscal 2026. Broadcom consistently generates free cash flow margins above 40%, which we expect to continue,” concluded Kerwin.
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