A leveraged inverse ETF has seen notable inflows in recent sessions as the Russell 2000 has stalled somewhat after an impressive rally late last week.

Direxion Daily Small Cap Bear 3X (NYSEArca: TZA) has taken in nearly $150 million in new assets via creation activity in recent trading days, which equates to more than 20% of the assets outstanding in the fund.

Additionally, we saw call buyers in TZA yesterday which is likely a driver behind asset inflows as well. TZA is designed to deliver three times the daily inverse return of the Russell 2000 Index. [Brokers Fined Over Leveraged and Inverse ETF Sales]

The iShares Russell 2000 (NYSEArca: IWM) is the benchmark ETF that investors are very familiar with in terms of getting “long” exposure to the Russell 2000, and we have seen a trend of put accumulation in recent weeks in IWM options.

It is possible that institutional managers are using TZA for outright bearish speculation, looking for a pullback in the index, or potentially aggressively hedging long positions in portfolios with a long TZA position.

We also note that small caps, represented by the Russell 2000, have lagged large caps year to date, with the Russell 2000 up 10.67% versus the S&P 500 up 12.14%.

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