The notorious Direxion Daily Junior Gold Miners Index Bull 3x Shares (NYSEArca: JNUG), the triple-leveraged answer to the popular Market Vectors Junior Gold Miners ETF (NYSEArca: GDXJ), will finally undergo the reverse split that some market participants previously speculated was coming.
Direxion, the second-largest issuer of inverse and leveraged ETFs, said JNUG will be reverse split on a 1-for-10 basis effective at the opening of the markets on Tuesday, December 23, 2014.
We suspected JNUG’s reverse split was coming, though our prediction was on the early side.
On the back of this year’s tumble for gold prices, JNUG has plunged 63.5%, making it one of this year’s worst-performing leveraged ETFs. That has not stopped investors from pouring money into the ETF. JNUG has hauled in $560.1 million in new assets this year while the Direxion Daily Gold Miners Bull 3X Shares (NYSEArca: NUGT), the triple-leveraged answer to the Market Vectors Gold Miners ETF (NYSEArca: GDX), has added $360.1 million in new assets. NUGT is not undergoing another reverse split, at least not yet. [Another Bad Day for Gold Miners ETFs]
Direxion also announced a 1-for-6 reverse split for the Direxion Daily Russia Bull 3x Shares (NYSEArca: RUSL), the triple-leveraged answer to the Market Vectors Russia ETF (NYSEArca: RSX).