Interested in leveraged ETFs? In the U.S. equity universe, Exchange Traded Funds have occupied a strong position being a popular security among traders and investors. The choice of putting one’s money in ETFs is pretty clear, since they offer many benefits in terms of taxes, costs, dividends and also intraday price fluctuations, which is convinient for speculative investors.
One more good thing about ETFs is their leveraging tactics. This means that a leveraged ETF employs financial derivates and debt, aside from the price variations of the index it follows. To put it more simply, a leveraged ETF increases by a double or triple amount as the index it tracks. However, it’s not so perfect, and the downside of the leverage is that it works the other way as well, so if the index followed declines, the fund loses even more ground.
With this in mind, let’s take a look at some of the biggest and highest returning leveraged ETFs, in terms of AUM and year-to-date returns, in a style similar to our coverage of short ETFs. ProShares Trust (NYSEARCA:TBZ), which tracks the Barclays Capital U.S. 3-7 Year Treasury Bond Index, is a member of the list, has a year-to-date return 3.3% and over $4 million in assets under management.
Read on to see the list of more leveraged ETFs:
No. 9 PowerShares DB 3X Italian Treasury Bond Futures ETN (NYSEARCA:ITLT)
Assets Under Management: $11.4 million
Year-to-date return: 6.8%
Index the ETF tracks: DB USD BTP Futures Index
Leverage: 3x
No. 8 JPMorgan Double Short US Long Bond Treasury Futures ETN (NYSEARCA:DSTJ)
Assets Under Management: $8 million
Year-to-date return: 10.3%
Index the ETF tracks: NYSE US Long Bond Treasury Futures Index
Leverage: 2x
No. 7 Direxion Daily 7-10 Year Trsry Br 3X Shr (NYSEARCA:TYO)
Assets Under Management: $59 million
Year-to-date return: 13.5%
Index the ETF tracks: NYSE 7-10 Year Treasury Bond Index
Leverage: 3x
No. 6 JPMorgan Double Short US 10 Year Treasury Futures ETN (NYSEARCA:DSXJ)
Assets Under Management: $8.3 million
Year-to-date return: 112%
Index the ETF tracks: NYSE US 10 Year Treasury Futures Index
Leverage: 2x
No. 5 PowerShares DB 3X Short 25 Year Treasury Bond ETN (NYSEARCA:SBND)
Assets Under Management: $58.5 million
Year-to-date return: 35.7%
Index the ETF tracks: Deutsche Bank Short U.S. Treasury Bond Futures Index
Leverage: 3x
No. 4 ProShares UltraShrt Lehman 7-10 Yr(ETF) (NYSEARCA:PST)
Assets Under Management: $318.1 million
Year-to-date return: 10.2%
Index the ETF tracks: Barclays Capital U.S. 7-10 Year Treasury Index
Leverage: 2x
No. 3 ProShares Trust (NYSEARCA:TTT)
Assets Under Management: $92.5 million
Year-to-date return: 34.6%
Index the ETF tracks: Barclays Capital U.S. 20+ Year Treasury Index
Leverage: 3x
No. 2 ProShares UltraShort 20+ Year Trea (ETF) (NYSEARCA:TBT)
Assets Under Management: $4.1 billion
Year-to-date return: 23.1%
Index the ETF tracks: Barclays Capital U.S. 20+ Year Treasury Index
Leverage: 2x
No. 1 Direxion Daily 20 Year Plus Treasury Br (NYSEARCA:TMV)
Assets Under Management: $521.3 million
Year-to-date return: 32.5%
Index the ETF tracks: NYSE 20 Year Plus Treasury Bond Index
Leverage: 2x