The recent turbulent markets have given many new exchange traded funds (ETFs) their first performance test. ETFs that track broad stock-market indexes performed as expected. Narrowly-focused ETFs and ETFs that use complex strategies to enhance an index’s gains gave mixed results, says Eleanor Laise for the Wall Street Journal.

Leveraged ETFs that magnify market movements were among the biggest winners and losers. The UltraShort Russell MidCap Value ProShares (SJL) ETF that aims to produce twice the opposite of the daily performance of the Russell Midcap Value Index was up 25.2% for the month that ended Aug. 16. However, the Ultra Basic Materials ProShares (UYM) that tries to produce twice the daily performance of the Dow Jones U.S. Basic Materials Index dropped 27.7% during the same time period.

ETFs that focus on the housing market such as the iShares Dow Jones U.S. Home Construction (ITB) and SPDR S&P Homebuilders (XHB) suffered a severe blow. In addition, some ETFs that appeared similar on the surface had different results. For example, the iShares FTSE/Xinhua China 25 Index (FXI) dropped 10.5% for the month while the PowerShares Golden Dragon Halter USX China Portfolio (PGJ) dropped 13.9% for the month.

These ETF results show why it’s important for investors to know and understand what’s in their ETFs and how it affects their performance.

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.