Direxion to Launch Leveraged S&P 500 ETF

ETF Trends

Direxion, the second-largest issuer of inverse and leveraged exchange traded funds, will launch the Direxion Daily S&P 500 Bull 2X Shares (NYSEArca:SPUU) today.

The new ETF was formerly known as the Direxion Daily Large Cap Bull 2X Shares. That ETF did not track the S&P 500. The S&P 500, the benchmark U.S. index, had annualized volatility of almost 19.5% for the five-year period ending Dec. 31, 2013 and the index’s highest volatility in a single calendar year over that period was almost 27.6%, according to a Direxion filing.

The new double-leveraged S&P 500 ETF will compete with the ProShares Ultra S&P500 ETF (SSO) . SSO had $3.23 billion in assets under management at the end of the first quarter, according to ProShares data.

Direxion also offers bullish and bearish triple-leveraged S&P 500 offerings, the Direxion Daily S&P 500 Bull 3X Shares (SPXL) and the Direxion Daily S&P 500 Bear 3X Shares (SPXS) .

The Direxion filing did mention a bearish equivalent to SPUU, the Direxion Daily S&P 500 Bear 2X Shares, which would trade on the New York Stock Exchange under the ticker “SFVS.”

That ETF would compete with the UltraShort S&P500 ProShares (SDS) .

Other new offerings launched by Direxion this year include the Direxion Daily Gold Bull 3X Shares (GLDL) and the Direxion Daily Gold Bear 3X Shares (GLDS) .

GLDL and GLDS are the first ETFs to provide triple-leveraged bullish and bearish exposure to Comex gold futures.

The S&P 500 closed at a new record high on Tuesday and is up 4.3% year-to-date.

 

ETF Trends editorial team contributed to this post.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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