Direxion Unveils +/- 3x Versions of Market Vectors Agribusiness and Russia ETFs
Direxion rolled out four new ETFs yesterday (5/25/11) providing +3x and -3x leveraged exposure to existing ETF offerings from Van Eck Market Vectors. This is not the first time Direxion has taken this path, having added leverage to the Market Vectors Gold Miners ETF (GDX) last December.
Direxion Daily Agribusiness Bull 3x Shares (COWL) and Direxion Daily Agribusiness Bear 3x Shares (COWS) track the same DAXglobal Agribusiness Index as the unleveraged Market Vectors Agribusiness ETF (MOO) (MOO overview). COWL provides +300% the daily return while COWS provides -300% (three times the inverse) the daily return. The new ETFs hold swaps on the performance of MOO and have their expense ratios capped at 0.95%.
The underlying index has current sector exposures of Materials 48.0%, Consumer Staples 35.0%, and Industrials 17.0%. Country weightings include U.S. 47.9%, Singapore 10.5%, Canada 10.0%, Switzerland 7.5%, and Germany 4.4%. The COWL/COWS combined fact sheet (pdf) provides additional background on the funds, while the COWL overview and COWS overview contain links to other material.
Direxion Daily Russia Bull 3x Shares (RUSL) and Direxion Daily Russia Bear 3x Shares (RUSS) track the same DAXglobal Russia+ Index as the unleveraged Market Vectors Russia ETF (RSX) (RSX overview). RUSL provides +300% the daily return while RUSS provides -300% the daily return. The new ETFs hold swaps on the performance of RSX and have their expense ratios capped at 0.95%.
The underlying index has current sector exposures of Energy 53.2%, Materials 26.2%, Financials 5.7%, Telecom 5.0%, Consumer Staples 5.0%, and others 4.2%. The RUSL/RUSS combined fact sheet (pdf) provides additional background on the funds, while the RUSL overview and RUSS overview contain links to other material.
As with all leveraged products, investors need to fully understand the 3x impact and daily compounding of leverage before wandering into these new ETFs.
Disclosure covering writer, editor, and publisher: No positions in any of the securities mentioned. No positions in any of the companies or ETF sponsors mentioned. No income, revenue, or other compensation (either directly or indirectly) received from, or on behalf of, any of the companies or ETF sponsors mentioned.
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