Leveraged Russia ETFs Loving Putin’s Shenanigans
March 18th, 2014 at 2:22pm by Todd Shriber
With global investors still jittery about Russian President Vladimir Putin’s plan near-term plans now that Crimea has overwhelmingly voted to join the Russian Federation, Russia exchange trade funds still offer tales in potential treachery and, for the risk-tolerant, profits.
With Tuesday’s gain of 4.2%, the Market Vectors Russia ETF (NYSEArca: RSX), the largest Russia ETF by assets, is up 6.1% in the past week. RSX even traded higher last Friday in advance of Sunday’s referendum in Crimea. RSX and the rival iShares MSCI Russia Capped ETF (NYSEArca: ERUS) are capturing the bulk of the attention among Russia ETFs, but savvy traders in search of rapid near-term gains know where to look beyond those ETFs. [A Strategist Questions Russia's Market Status]
Including Tuesday’s almost 13% gain, which has been accrued on volume that is already more than seven times the daily average, the Direxion Daily Russia Bull 3x Shares (NYSEArca: RUSL) is up 32% since March 13. However, heading into Tuesday, the Direxion Daily Russia Bear 3x Shares (NYSEArca: RUSS) was up more than 43% in the past month. [Putin Pushes Traders to Risky Russia ETFs]
RUSL and RUSS frequently do not receive the notoriety that some other leveraged ETFs, but Russia’s invasion of Ukraine and ongoing skittishness regarding Putin’s near-term plans has put the spotlight on these volatile funds. Data confirm as much.
As of Monday, RUSS was the second-best triple-leveraged ETF in Direxion’s lineup on a month-to-date basis while RUSL was the worst. Assessing 30-day realized volatility, RUSL was the second-most volatile bullish ETF in Direxion’s stable while only one leveraged inverse ETF was more volatile than RUSS over that time, according to Direxion data.
In further proof that traders are taking to RUSL and RUSS, RUSL’s five-day volume expressed as a percentage of its 20-day average volume is tops among all leveraged Direxion funds while RUSS places third on that basis, Direxion data show.
In what may be something of a surprise, RSX has taken in over $254.3 million in new assets over the past month while RUSL is one of the leaders among Direxion’s bullish funds in terms of new creations. Then again, RUSS is one of the issuer’s better bearish ETFs regarding 30-day creations.
Direxion Daily Russia Bull 3x Shares