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Inside The 8x Leveraged ETN

by on July 12, 2011 | Updated December 8, 2014

Innovation has been on display in the ETF industry in recent years, as various issuers have been active on the product development front in their efforts to bring new and exciting products to market. One area that has seen tremendous growth is the leveraged ETF space; investors have embraced the exchange-traded structure as an efficient means of amplifying exposure to everything from Chinese stocks (YINN, YANG) to gold (UGL, GLL) to long-term Treasuries (TBT, UBT).

In total, there are nearly 200 leveraged ETPs, covering dozen of different asset classes. But not all leveraged exchange-traded products utilize the same structure; there are some nuances across the roster of these funds that can have a significant impact on the risk/return profile offered. Most investors are aware of the differences between ETFs and ETNs, including distinctions in credit risk, tracking error, and sometimes tax ramifications as well. But some don’t realize that the reset frequency can also vary from product to product, and that the timing of such resets can have a major impact on the volatility and potential returns of a product. [click to continue…]

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PowerShares and Deutsche Bank have expanded their ETF partnership, rolling out a pair of 3x leveraged ETNs offering amplified exposure to long-term Treasuries. The two products, which started trading on Wednesday, include: [click to continue…]

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After adding more than 100 new funds and taking in nearly $120 billion in cash in 2009, it seemed that the ETF industry would be hard-pressed to match that impressive pace in 2010. But an action-packed January that saw more than a dozen new funds, setting a pace that would shatter last year’s expansion. The […]

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ProShares made an addition to its line of leveraged fixed income products on Thursday, launching the Ultra 7-10 Year Treasury (UST) and Ultra 20+ Year Treasury (UBT). UST seeks daily investment results that correspond to 200% of the daily performance of the Barclays Capital 7-10 Year U.S. Treasury Index, while UBT will seek to deliver […]

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