Core Insights - Leveraged ETFs require a distinct monitoring framework compared to traditional buy-and-hold funds, highlighting the need for specialized strategies in managing these investment vehicles [1] Group 1: Leveraged ETFs - SOXL offers 3x daily exposure to the semiconductor sector, emphasizing the unique characteristics and risks associated with leveraged ETFs [1]

Anyone who happened to be holding a leveraged Netflix ETF leading up to last week’s news likely got stung … stranger things have happened. The company’s blockbuster deal with Warner Bros. Discover sent Netflix’s stock lower, and the target’s stock upward, amid news of a hostile takeover bid by Paramount Skydance and indications by President Trump that he’s not in favor of the acquisition. With Netflix stock down 9.4% over the past five days, 2X leveraged ETFs are unsurprisingly down by about twice that am ...

Hosts Dave Nadig, President and Director of Research at ETF.com as well as Sumit Roy, Senior ETF Analyst at ETF.com, are joined by industry experts to cover the latest and greatest happenings in ETFs. This week's episode features Mike Akins, Founding Partner of ETF Action; Eric Balchunas, Senior ETF Analyst at Bloomberg Intelligence; and Todd Sohn, Senior ETF & Technical Strategist at Strategas Securities. In this episode of the ETF Zoo, the panel discusses the latest trends in the ETF market, including s ...

By Shashwat Chauhan Dec 4 (Reuters) - ETF provider ProShares has withdrawn its registration request for some highly leveraged exchange-traded funds after receiving a warning letter from the U.S. securities regulator that ​flagged risk exposures and paused the review of such plans. Such letters were sent on Tuesday to ‌nine ETF providers, including ProShares, Direxion and GraniteShares, asking them to provide more clarity on the risks tied to funds that sought ‌to track up to fives times the performance o ...

The Securities and Exchange Commission is putting a stopper in new leveraged funds, for now. The agency on Tuesday sent warning letters to nine issuers — including Direxion, GraniteShares and ProShares — halting reviews of leveraged ETFs that provide more than 2x exposure to their underlying securities. In stopping reviews and asking issuers to either revise their strategies or withdraw their applications, the SEC, which has been on a deregulatory streak since the beginning of the second Trump administrat ...

ETF Market Trends - Leveraged and inverse ETFs, while small relative to the overall ETF market, exhibit significant trading activity, raising questions about their potential impact on the options markets [2] - Retail investors and ETF issuers are increasingly engaging with risky leveraged and options-based ETFs, viewing them as "lottery tickets" with potential for high returns [7][8] - The industry anticipates a lifecycle for retail investors in these products, with initial enthusiasm potentially leading to negative experiences and a subsequent shift towards more traditional index funds [9][10] - Issuers will continue to launch these products, but some will thrive while others will fail, presenting closure risk [10][11] Correlation and Volatility - There's a notable increase in volatility within the risk-on/risk-off space, impacting crypto and other high-beta stocks, leading to conditional correlation where seemingly unrelated stocks trade in line during market weakness [3][4][5] - Correlation convergence is observed during periods of volatility, impacting the prices of options on sector-based ETFs [5][6] Crypto ETFs - Despite recent downside volatility, Bitcoin ETFs have experienced substantial growth, with Bitcoin up over 80% since the launch of spot Bitcoin ETFs in January 2024 [12][17] - Spot Bitcoin ETFs have seen outflows of approximately $45 billion over the past month, but year-to-date inflows remain significant at around $22 billion [18] - Spot Ether ETFs are down 40% since early October, but year-to-date inflows are about $10 billion [19] - Deleveraging in the crypto space is identified as a primary driver of recent weakness, exacerbated by broader equity market weakness and increased correlation among higher beta names [19][20] - Bitcoin price could test the $70,000 level, which represents the breakout point and the cost basis of strategies Bitcoin holdings, potentially finding support near the cash cost of mining [16]

Core Insights - Retail investors have been highly active in the markets this year, significantly increasing their investments in broad-based ETFs and other assets [1][2] - Despite institutional doubts about the sustainability of the AI trade, retail investors continue to invest in AI-related stocks [2] - Retail investor leverage has reached record levels, with brokerage account leverage exceeding $1.1 trillion, the highest since the 1990s [3][4] Investment Trends - Retail investors are purchasing assets at a rate 50% above last year's levels, indicating strong market participation [2] - Leveraged ETFs have seen assets surpassing $140 billion, reflecting the confidence of retail investors despite recent market volatility [5] - Individual investors have experienced a 15% return on the S&P 500 this year, contributing to a positive sentiment heading into the Thanksgiving holiday [7][9] Market Performance - The U.S. market has delivered strong returns over the past two years, with this year being the best in a quarter-century [9] - While some retail favorites have faced declines, broader ETF inflows have continued for 10 consecutive weeks, indicating sustained interest in diversified investments [11]

Korea leverage ETF. Photo by BeInCrypto South Korea is tightening oversight of its most aggressive retail traders, introducing mandatory training for anyone who wants to trade foreign leveraged ETFs. The move follows a record surge of Korean money into high-risk US products—and growing concern that this speculative wave is distorting global markets. South Korea’s Regulators Step In After a $7 Billion Monthly Surge South Korea’s Financial Supervisory Service (FSS) will require retail investors to complet ...

Group 1 - The proliferation of leveraged ETFs, single stock ETFs, and 'enhanced income' covered call ETFs has led to market oversaturation, causing confusion for investors [1][2] - The Harvest team is attempting to innovate within their niche by focusing on single stock 'enhanced income' covered call ETFs, which may not be in the best interest of investors [2] - There is a suggestion that the Harvest team should consider selling their fund management business to a larger player due to their sub-scale operations [2]

Core Viewpoint - Wall Street is increasingly pursuing the launch of riskier leveraged ETFs, with issuers testing the limits of legal boundaries in the U.S. through a surge of recent filings [1] Group 1 - The trend of launching leveraged ETFs is gaining momentum among financial institutions [1] - Recent filings indicate a significant increase in the appetite for riskier investment products [1] - Issuers are exploring the legal framework to expand the types of leveraged ETFs available in the market [1]