We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Leveraged ETFs Gain Popularity on Market Rebound Hopes
Read MoreHide Full Article
Leveraged ETFs have gained popularity this month with investors positioning themselves for amplified gains amid expectations of a market rebound following a sell-off triggered by U.S. President Donald Trump’s trade tariffs.
According to LSEG Lipper data, leveraged equity ETFs have attracted $10.95 billion in inflows so far in April, surpassing a five-year high of $9.2 billion recorded last month. This marks the strongest monthly inflows since March 2020, when markets were roiled by COVID-19.
Direxion Daily Semiconductor Bull 3x Shares (SOXL - Free Report) became the most popular leveraged ETF this month, pulling in about $4.2 billion so far, per etf.com. ProShares UltraPro QQQ (TQQQ - Free Report) has gathered $3.3 billion while Direxion Daily TSLA Bull 2X Shares (TSLL - Free Report) and Direxion Daily S&P 500 Bull 3x Shares (SPXL - Free Report) have seen inflows of $689.9 million and $408.2 million, respectively.
Leveraged ETFs provide multiple exposure (2X or 3X) to the daily performance of the underlying index, making them a popular choice for investors looking to capitalize on short-term market moves without engaging in derivatives or futures. These offer a way to capture the whiplash of sentiment-driven markets.
Market Stabilizes
The announcement of a 10% universal tariff on imports, coupled with additional country-specific tariffs — most notably a 145% levy on Chinese goods — triggered a sharp market downturn earlier this month. Major indices like the S&P 500 and Dow Jones Industrial Average experienced substantial losses, entering bear market territory early in the month. However, the latest developments suggest a potential stabilization, leading to a modest stock recovery (read: 5 ETFs Scaling New Highs Amid Market Turmoil).
Earlier this week, President Donald Trump indicated a potential reduction in the steep tariffs imposed on Chinese imports. At a White House press conference on Tuesday, Trump called the current 145% reciprocal tariffs "too high" and said they would "come down substantially."
Treasury Secretary Scott Bessent echoed the sentiment, stating that the tariff standoff with China is "unsustainable" and expressed confidence that a deal between the two nations could eventually be reached. A Wall Street Journal report further intensified the situation, revealing that U.S. officials are considering reducing tariffs on China to 50–65% but are depending on China to lower its trade barriers.
Trump, who criticized Powell by calling him a “major loser,” clarified that he had no plans to oust him before his term ends in May 2026.
As trade tensions eased, Wall Street rallied for three consecutive sessions and is on course for another day of gains in pre-market trade today at the time of writing. Amid the three-day rally, the tech-heavy Nasdaq Composite index outperformed, rising more than 8%, followed by gains of over 6% for the S&P 500 and 5% for the blue-chip Dow Jones Index (read: Tariff Relief Talks Lift Tech ETFs, Stocks: What's Ahead?).
With AUM of $7.8 billion, Direxion Daily Semiconductor Bull 3x Shares targets the semiconductor corner of the technology sector with three times leveraged exposure to the NYSE Semiconductor Index. It charges 72 bps in fees per year and trades in an average daily volume of 298 million shares.
ProShares UltraPro QQQ offers three times the leveraged exposure to the NASDAQ-100 Index. It has amassed $17.2 billion in AUM and trades in a heavy volume of 154.6 million shares, on average. It charges 84 bps in annual fees.
With AUM of $3.8 billion, Direxion Daily TSLA Bull 2X Shares is by far the largest U.S.-listed single-stock ETF on the market. It offers two times (200%) the daily percentage change of the common stock of Tesla, charging 84 bps in annual fees. TSLL trades in a heavy volume of 241 million shares (read: Should You Buy Tesla ETFs Post Q1 Earnings Miss?).
Direxion Daily S&P 500 Bull 3x Shares creates a 3X long position in the S&P 500 Index with an expense ratio of 0.85%. It has AUM of $3.6 billion and trades in an average daily volume of nearly 9 million shares.
Caveat!
As a caveat, investors should note that these products are extremely volatile and suitable only for short-term traders. Additionally, the daily rebalancing, when combined with leverage, may make these products deviate significantly from the expected long-term performance figures (see: all the Leveraged Equity ETFs here).
Yet, for ETF investors who are bullish on these sectors in the near term, any of the abovementioned products can be an interesting choice. A near-term long could be intriguing for those with high risk tolerance and a belief that the trend is a friend in this corner of the investing world.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Leveraged ETFs Gain Popularity on Market Rebound Hopes
Leveraged ETFs have gained popularity this month with investors positioning themselves for amplified gains amid expectations of a market rebound following a sell-off triggered by U.S. President Donald Trump’s trade tariffs.
According to LSEG Lipper data, leveraged equity ETFs have attracted $10.95 billion in inflows so far in April, surpassing a five-year high of $9.2 billion recorded last month. This marks the strongest monthly inflows since March 2020, when markets were roiled by COVID-19.
Direxion Daily Semiconductor Bull 3x Shares (SOXL - Free Report) became the most popular leveraged ETF this month, pulling in about $4.2 billion so far, per etf.com. ProShares UltraPro QQQ (TQQQ - Free Report) has gathered $3.3 billion while Direxion Daily TSLA Bull 2X Shares (TSLL - Free Report) and Direxion Daily S&P 500 Bull 3x Shares (SPXL - Free Report) have seen inflows of $689.9 million and $408.2 million, respectively.
Leveraged ETFs provide multiple exposure (2X or 3X) to the daily performance of the underlying index, making them a popular choice for investors looking to capitalize on short-term market moves without engaging in derivatives or futures. These offer a way to capture the whiplash of sentiment-driven markets.
Market Stabilizes
The announcement of a 10% universal tariff on imports, coupled with additional country-specific tariffs — most notably a 145% levy on Chinese goods — triggered a sharp market downturn earlier this month. Major indices like the S&P 500 and Dow Jones Industrial Average experienced substantial losses, entering bear market territory early in the month. However, the latest developments suggest a potential stabilization, leading to a modest stock recovery (read: 5 ETFs Scaling New Highs Amid Market Turmoil).
Earlier this week, President Donald Trump indicated a potential reduction in the steep tariffs imposed on Chinese imports. At a White House press conference on Tuesday, Trump called the current 145% reciprocal tariffs "too high" and said they would "come down substantially."
Treasury Secretary Scott Bessent echoed the sentiment, stating that the tariff standoff with China is "unsustainable" and expressed confidence that a deal between the two nations could eventually be reached. A Wall Street Journal report further intensified the situation, revealing that U.S. officials are considering reducing tariffs on China to 50–65% but are depending on China to lower its trade barriers.
Trump, who criticized Powell by calling him a “major loser,” clarified that he had no plans to oust him before his term ends in May 2026.
As trade tensions eased, Wall Street rallied for three consecutive sessions and is on course for another day of gains in pre-market trade today at the time of writing. Amid the three-day rally, the tech-heavy Nasdaq Composite index outperformed, rising more than 8%, followed by gains of over 6% for the S&P 500 and 5% for the blue-chip Dow Jones Index (read: Tariff Relief Talks Lift Tech ETFs, Stocks: What's Ahead?).
Leveraged ETFs in Focus
Direxion Daily Semiconductor Bull 3x Shares (SOXL - Free Report)
With AUM of $7.8 billion, Direxion Daily Semiconductor Bull 3x Shares targets the semiconductor corner of the technology sector with three times leveraged exposure to the NYSE Semiconductor Index. It charges 72 bps in fees per year and trades in an average daily volume of 298 million shares.
ProShares UltraPro QQQ (TQQQ - Free Report)
ProShares UltraPro QQQ offers three times the leveraged exposure to the NASDAQ-100 Index. It has amassed $17.2 billion in AUM and trades in a heavy volume of 154.6 million shares, on average. It charges 84 bps in annual fees.
Direxion Daily TSLA Bull 2X Shares (TSLL - Free Report)
With AUM of $3.8 billion, Direxion Daily TSLA Bull 2X Shares is by far the largest U.S.-listed single-stock ETF on the market. It offers two times (200%) the daily percentage change of the common stock of Tesla, charging 84 bps in annual fees. TSLL trades in a heavy volume of 241 million shares (read: Should You Buy Tesla ETFs Post Q1 Earnings Miss?).
Direxion Daily S&P 500 Bull 3x Shares (SPXL - Free Report)
Direxion Daily S&P 500 Bull 3x Shares creates a 3X long position in the S&P 500 Index with an expense ratio of 0.85%. It has AUM of $3.6 billion and trades in an average daily volume of nearly 9 million shares.
Caveat!
As a caveat, investors should note that these products are extremely volatile and suitable only for short-term traders. Additionally, the daily rebalancing, when combined with leverage, may make these products deviate significantly from the expected long-term performance figures (see: all the Leveraged Equity ETFs here).
Yet, for ETF investors who are bullish on these sectors in the near term, any of the abovementioned products can be an interesting choice. A near-term long could be intriguing for those with high risk tolerance and a belief that the trend is a friend in this corner of the investing world.