Leveraged exchange-traded products are alluring to investors looking to supercharge their returns to capitalize on short-term movements in the markets. While they are intended for advanced investors, it can open up a broad range of opportunities for intermediate investors looking to take their investing to another level or to hedge current long-term investments in their respective portfolios.
As such, it benefits investors to know where the opportunities are with respect to leveraged exchange-traded products and one place to start is by identifying who the biggest players are in the marketplace. Below are five of the largest leveraged equity ETFs based on total assets.
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1. ProShares UltraPro QQQ (NasdaqGM: TQQQ)–$4.27 Billion
TQQQ seeks daily investment results that correspond to three times (3x) the daily performance of the NASDAQ-100 Index. The fund invests in securities and derivatives that ProShare Advisors believes, in combination, should have similar daily return characteristics as three times (3x) the daily return of the index. The index, a modified market capitalization-weighted index, includes 100 of the largest non-financial domestic and international issues listed on the NASDAQ Stock Market.
2. ProShares Ultra S&P500 (NYSEArca: SSO)–$2.72 Billion
SSO seeks daily investment results that correspond to two times (2x) the daily performance of the S&P 500®. The fund invests in securities and derivatives that ProShare Advisors believes, in combination, should have similar daily return characteristics as two times (2x) the daily return of the index.
The index is a measure of large-cap U.S. stock market performance. It is a float-adjusted, market capitalization-weighted index of 500 U.S. operating companies and real estate investment trusts selected through a process.
3. Credit Suisse FI Large Cap Gr Enh ETN (NYSEArca: FLGE)–$2.44 Billion
FLGE seeks a leveraged return linked to the performance of the Russell 1000® Growth Index Total Return, which seeks to track the performance of the large-cap growth segment of the U.S. equity market. The ETNs are subject to a leverage factor of 2.0, but the effective leverage will vary with changes in the Closing Indicative Value of the ETNs since the previous Rebalance Event.
4. ProShares Ultra QQQ (NYSEArca: QLD)–$2.16 Billion
QLD seeks daily investment results that correspond to two times the daily performance of the NASDAQ-100 Index®. The fund invests in securities and derivatives that ProShare Advisors identifies as having similar daily return characteristics equal to two times (2x) the daily return of the index. The index is a modified market capitalization-weighted index that includes 100 of the largest non-financial domestic and international issues listed on the NASDAQ Stock Market.
5. UBS AG FI Enhanced Large Cap Growth ETN (NYSEArca: FBGX)–$1.77 Billion
FBGX seeks a return linked to the Russell 1000® Growth Total Return Index. The UBS AG FI Enhanced Large Cap Growth ETN due June 19, 2024 are a series of FI Enhanced ETNs.
The level of the index reflects both the price performance of the index constituent Securities and the reinvestment of dividends on the index constituent securities. The securities double-leveraged with respect to the index and, as a result, may benefit from two times any positive, but will be exposed to two times any negative, quarterly performance of the index.
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