With the equities markets waddling through 2021, earnings reports could significantly define the second half of the year.
Most traders will be watching the S&P 500.
“Stocks closed out Q2 at a high water mark. The S&P 500 is up 14% through June 30th as the Dow Jones Industrial Average has climbed 13%,” Direxion Investments said in an analysis. “Both have been powered by an economic recovery that many investors believe is still gaining ground.”
“But while the mood should be ecstatic, considering the state of the world just 12 months ago, investors and traders are focused on the second half of 2021,” the analysis said. “While the market may be priced to perfection based on current earnings, it’s projections for future earnings that will be most anticipated this time around. That’s because U.S. businesses are at a critical moment coming out of the Covid-19 pandemic. Many analysts expect Q2 earnings to be the peak of the recovery.”
3 S&P 500 Funds to Trade
Investors seeking exposure to the S&P 500 have a number of bullish and bearish options available. Assets in this arena also come in leveraged and non-leveraged flavors.
One low-risk bearish option is the Direxion Daily S&P 500 Bear 1X Shares (SPDN).
SPDN seeks daily investment results, before fees and expenses, of 100% of the inverse (or opposite) of the daily performance of the S&P 500® Index. The fund, under normal circumstances, invests in swap agreements, futures contracts, short positions or other financial instruments that, in combination, provide inverse (opposite) or short exposure to the index equal to at least 80% of the fund’s net assets.
For bullish exposure with twice the leverage, there’s the Direxion Daily S&P 500 Bull 2X Shares (SPUU). The ETF seeks daily investment results, before fees and expenses, of 200% of the daily performance of the S&P 500® Index.
The fund, under normal circumstances, invests at least 80% of its net assets (plus borrowing for investment purposes) in financial instruments, such as swap agreements, securities of the index, and ETFs that track the index and other financial instruments that provide daily leveraged exposure to the index or to ETFs that track the index.
For the bold, there exists the Direxion Daily S&P 500® Bull 3X Shares ETF (SPXL), which gives triple exposure to the S&P 500. SPXL, under normal circumstances, invests at least 80% of its net assets (plus borrowing for investment purposes) in financial instruments, such as swap agreements, and securities of the index, ETFs that track the index and other financial instruments that provide daily leveraged exposure to the index or ETFs that track the index.
For more news and information, visit the Leveraged & Inverse Channel.
