If Auric Goldfinger, the villain in the 1964 James Bond movie “Goldfinger,” was a real person and alive today, there is an excellent chance he would be enthralled by two new exchange funds debuting today from Direxion.
Well, Mr. Goldfinger would almost certainly be a fan of the Direxion Daily Gold Bull 3X Shares (NYSEArca: GLDL). As for the Direxion Daily Gold Bear 3X Shares (NYSEArca: GLDS), that can be viewed as the anti-Goldfinger ETF. GLDL and GLDS are the first ETFs to provide triple-leveraged bullish and bearish exposure to Comex Gold futures.
“Direxion’s leveraged ETFs are aggressive, athletic trading tools designed to provide sophisticated traders with a vehicle to take advantage of market opportunities in either direction. By providing exposure to select markets on the long and short side, we help traders respond to short-term price movement as part of their overall active investment strategies,” said Dan O’Neill, CEO of Direxion, in a statement.
The new Direxion ETFs will compete with the double-leveraged rivals the ProShares UltraShort Gold (NYSEArca: GLL) and the ProShares Ultra Gold (NYSEArca: UGL).
Direxion launches its triple-leveraged gold offerings at a time when the yellow metal is perking up after a forgettable 2013 performance. The SPDR Gold Shares (NYSEArca: GLD) is up about 5% this year.[A Positive View on Commodities ETFs]
Globally, investors pulled $946 million from gold ETFs in January, but they returned to ETFs like GLD and the ETFS Physical Swiss Gold Shares (NYSEArca: SGOL) in February and March, allocating a combined $858 million to gold funds in those two months. [Strong Demand Seen for Gold, Silver ETFs]
Gold and gold futures are often considered a play on economic, political, or currency events. Many investors think the decline in gold prices that started last year will continue, and that gold may be susceptible to a severe drawdown similar to the period from 1988 to 1999. There’s sentiment from others that gold has bottomed, and it’s time to buy low, according to Direxion.
Direxion is no stranger to leveraged gold ETFs. The Direxion Daily Gold Miners Bull 3X Shares (NYSEArca: NUGT) and the Direxion Daily Gold Miners Bear 3X Shares (NYSEArca: DUST) are the dominant names among leveraged gold mining ETFs. The issuer also launched the Direxion Daily Junior Gold Miners Index Bull 3x Share (NYSEArca: JNUG) and the Direxion Daily Junior Gold Miners Index Bear 3X Shares (NYSEArca: JDST) last year. [Good News for Gold Mining ETFs]
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of GLD and JNUG.