Leveraged China ETFs to Change Indices

October 4th at 3:43pm by Tom Lydon

The Direxion Daily FTSE China Bull 3X Shares (NYSEArca: YINN) and the Direxion Daily FTSE China Bear 3X Shares (NYSEArca: YANG) will drop the BNY Mellon China Select ADR Index in favor of the FTSE China 25 Index in December.

The FTSE China 25 Index is the index tracked by the iShares China Large-Cap ETF (NYSEArca: FXI), the largest and most heavily traded China ETF.

The BNY Mellon China Select ADR Index “was weighted heavily toward Chinese Internet companies with little exposure to financials, and both funds traded with somewhat wide bid/ask spreads—around 40 basis points. By changing to an index composed of more liquid securities, Direxion might be able to narrow those spreads and produce better-tracking funds in YINN and YANG,” reports Hannah Tool for Index Universe.

FXI allocates 55.5% of its weight to financial services stocks and four of the ETF’s top-10 holdings are bank stocks. Other top-10 holdings include Tencent and PetroChina (NYSE: PTR), China’s largest oil company.

Direxion, the second-largest provider of inverse and leveraged ETFs, also offers leveraged country ETFs for Brazil, Russia, India, and South Korea, among others.

Direxion Daily China 3x Bull Shares

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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