“Obviously, we’re aware of others in the marketplace who have taken our lead, but what we’re trying to do is listen to the market place and deliver what they’re asking for.”

ProShares has been having a strong year so far, with nearly $8 billion net inflows. At the moment, Sapir says assets on both the leveraged and inverse side of the equation are fairly equal. He also notes that there’s about $4 billion-$5 billion of exposure in short fixed income, mostly from people looking to hedge the fixed income portion of their portfolios.

Note that leveraged ETFs aren’t for all investors and you should be aware of the risks. These types of ETFs need constant minding and evaluation, and are in no way meant for a buy-and-hold approach. A short or leveraged ETF requires vigilance because they must be rebalanced daily. When the market is volatile, with sustained swings in either direction, the leverage (and the effect of compounding) can make them diverge wildly from what the unwitting investor expects them to do.

For more stories about inverse and leveraged ETFs, visit our long-short ETF category.

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