The rebalancing of Leveraged ETFs

(3 posts)

  1. StanB
    Member

    Hi!

    I'm currently in the the pre-phase of writing my master thesis on Leveraged ETFs, so I'm gathering source material to better my understanding of the product. One question I have is how often the fund managers re-balance the LETFs. Is it during exchange hours, before,after?
    Banks in my home country (Norway) post the NAV(net asset value) five times a week, usually every morning right before the exchange opens. So am I to understand correctly that the fund managers re-balance the funds upon closing time at the exchange and calculate the NAV that is further posted the morning after?

    Posted 2 years ago #

  2. Donato
    Member

    Hi Stan . . .
    The answer for each fund can be found in it's respective prospectus. Which you can probably get online these days. I think most, if not all, the rebalancing takes place at the open.

    Posted 2 years ago #

  3. StanB
    Member

    Thank you Donato! I'll check out the prospectus of other LETFs. I had only looked into two before posting here and they didn't mention the time of re-balancing. I sent the same question to one of the banks after posting and they told me that they re-balance around the time derivatives market closes.

    Posted 2 years ago #

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