THis is what Direxion is Listing on the Web Site as Today's Close
Biggest Daily Movers As of Market Close: 12/09/08 Gainers Financial Bear 3x Shares 14.35% Small Cap Bear 3x Shares 9.73% Large Cap Bear 3x Shares 6.90% Decliners Financial Bull 3x Shares -14.36% Small Cap Bull 3x Shares -9.73% Large Cap Bull 3x Shares -6.83%
They're simply making the same mistake that many on this board have done -- looking at the wrong index. It's not the Russell 1000 index but the Russell 1000 Financial Services index. Two different things.
Thanks for the post. I just want to add to it. The info you posted is correct for FAZ, because it is NAV change. If you notice, the NAV change of 14.35 is 3 times the change in the ^RIFIN. Which is exactly what it should do. So, all the complainers (not saying you, just other idiots on this board) need to learn how the damn market works. The market price of this ETF, like all other exchange traded shares (including stocks), trade hands at the price the market determines. So, yesterday, the close was higher than the NAV, and today the close was lower, so the market price moved less than the NAV did. That is not a fault of the management of the fund, it is the market acting as it does.
Also remember there is compounding and leveraging plus costs. So over a period of a month, there will be serious discrepancies between the target and the fund. Which is why when this fund went to 200, the % and $ moves became very dramatic.
==== Example taken from prospectus: On Day 1, the XYZ index increases in value from $100 to $105, a gain of 5%. On Day 2, the XYZ index declines from $105 back to $100, a loss of 4.77%. In the aggregate, the XYZ index has not moved. An investment in Fund A would be expected to gain 5% on Day 1 and lose 4.76% on Day 2 to return to its original value.
The same $100 investment in Fund B, however, would be expected to gain 15% on Day 1 (300% of 5%) but decline 14.28% on Day 2.
Although the percentage decline is smaller on Day 2 than the percentage gain on Day 1, the loss is applied to a higher principal amount so the investment in Fund B has a loss even when the index value has not declined. (These calculations do not include the charges for expense ratio and the financing charges.) As you can see, an investment in Fund B has higher rewards and risks due to the effects of leverage and compounding.
"Those are the Net Asset Values (NAV), not the closing % price changes."
So in other words it's the supply and demand of FAZ that dictates its price, not the corresponding percentage change in the unerlying value, as many here believe. The NAV could be 45 but if people are willing to part from their shares for 20% less then it would go for 36. Or we could have a crash in the financials and simultaneously have FAZ go down if the supply and demand in the market would allow that. Did I get that right?