Can Black Friday Lift The Leveraged "RETL" Retail ETF?

The National Retail Federation is expecting consumers to open their wallets this holiday season with sales growing 4% higher this year. This should translate into gains for the Direxion Daily Retail Bull 3X ETF (NYSEArca: RETL) if their predictions hold up.

The hope, of course, is for a strong showing in retail sales this week. Per a CNBC report, JP Morgan analysts are expecting “sales to be up 4.9% during the holidays, much stronger than last year, when sales gained just 1.9% and shoppers were discouraged by a major sell off in the stock market.”

“I actually like adding to equities through the rest of the year,” said Cayman Wills, global head of equities at J.P. Morgan Private Bank.

Even with Black Friday on the docket, the major market mover will still be the U.S.-China trade deal. Both nations are still trying to iron out the details to reach a “phase one” agreement.

“It’s a call on trade in our view. You can’t really predict what Xi and Trump will do,” said Michael Schumacher, director rates, at Wells Fargo. The 10-year Treasury yield was at 1.75% Friday, from a high of 1.95% on Nov. 12. Rates have moved lower as concerns have increased that the U.S. and China will fail to reach a deal by Dec. 15, heading off a new round of tariffs expected to take effect that day.

RETL seeks daily investment results equal to 300% of the daily performance of the S&P Retail Select Industry Index. The index is a modified equal-weighted index that is designed to measure performance of the stocks comprising the S&P Total Market Index that are classified in the Global Industry Classification Standard (GICS) retail sub-industry.

RETL, and Direxion’s other leveraged ETFs are ideal for investors looking to:

  • Magnify short-term perspective with daily 3X leverage
  • Go where there’s opportunity, with bull and bear funds for both sides of the trade
  • Stay agile – with liquidity to trade through rapidly changing markets

For investors looking for non-leveraged options, they can opt for the following:

  1. Amplify Online Retail ETF (NasdaqGM: IBUY): seeks investment results that generally correspond to the price and yield of the EQM Online Retail Index. The index seeks to measure the performance of global equity securities of publicly traded companies with significant revenue from the online retail business. The index methodology is designed to result in a portfolio that has the potential for capital appreciation.
  2. SPDR S&P Retail ETF (NYSEArca: XRT): seeks to provide investment results that correspond generally to the total return performance of an index derived from the retail segment of a U.S. total market composite index. The index represents the retail segment of the S&P Total Market Index (“S&P TMI”).
  3. ProShares Online Retail ETF (NYSEArca: ONLN): seeks investment results that track the performance of the ProShares Online Retail Index (the index). The index is designed to measure the performance of publicly traded companies that principally sell online or through other non-store sales channels, such as through mobile or app purchases, rather than through “brick and mortar” store locations.

For more market trends, visit ETF Trends.