The Direxion Daily S&P 500 Bull (SPXL) and Bear (SPXS) 3X Shares aim daily investment outcomes of 300 percent, or 300 percent of the inverse (or opposite), of the S&P 500 Index performance, before fees and expenses. There is no assurance that the funds will achieve their stated investment goals.
Is SPXL a solid exchange-traded fund (ETF)?
SPXL is a 3x leveraged S&P 500 ETF that offers high returns at the expense of high risk. Backtests suggest that SPXL can be held for a long time and beats the S&P 500 in most instances, but that it would practically wipe out a portfolio during prolonged bear markets.
What exactly are SPXS and SPXL?
The Direxion Daily S&P 500 Bull (SPXL) and Bear (SPXS) 3X Shares aim daily investment outcomes of 300 percent, or 300 percent of the inverse (or opposite), of the S&P 500 Index performance, before fees and expenses. There is no assurance that the funds will achieve their stated investment goals.
What are 3X leveraged exchange-traded funds (ETFs)?
Leveraged 3X ETFs monitor a wide range of asset classes, including stocks, bonds, and commodity futures, and use leverage to achieve three times the daily or monthly return of the underlying index. These ETFs are available in both long and short versions.
More information on Leveraged 3X ETFs can be found by clicking on the tabs below, which include historical performance, dividends, holdings, expense ratios, technical indicators, analyst reports, and more. Select an option by clicking on it.
What are 3X leveraged stocks?
3x ETFs follow a wide range of asset classes, including stocks, bonds, and commodities futures, just like other leveraged ETFs. 3x ETFs, on the other hand, use even more leverage to attempt to achieve three times the daily or monthly return of their respective underlying indexes. The aim behind 3x ETFs is to profit from short-term fluctuations in financial markets. In the long run, other dangers emerge.
Should I put money into SPXS?
SPXS is a high-risk wager against the S&P 500, promising -300 percent of the index’s return over the course of a single day. Investors should be comfortable not only with the portfolio’s mechanics, but also with the counterparty risk it assumes to achieve its objectives: SPXS uses swaps on the index to achieve its objectives.
Is it possible to short SPXL?
This is true not only on a daily basis, when the fund falls three times as much as the S&P 500, but also over longer periods of time, as slippage eats down the fund’s gains. However, as I noted previously in the post, buying deep in-the-money put options is one strategy to short SPXL.
When did SPXL come into being?
The fund invests in large-cap firms’ growth and value equities. The fund aims to outperform the S&P 500 Index by 3 times on a daily basis. The Direxion Shares ETF Trust – Direxion Daily S&P 500 Bull 3X Shares was established on November 5, 2008, and is based in the United States.