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Direxion enters ETF market with three-times leveraged funds

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Boston-based alternative investment manager Direxion has launched into the exchange-traded funds market with the start of trading of the Direxion Shares 3x Exchange-Traded Funds on Novembe

Boston-based alternative investment manager Direxion has launched into the exchange-traded funds market with the start of trading of the Direxion Shares 3x Exchange-Traded Funds on November 5.

The new ETFs are a group of leveraged Bull and Bear index funds that seek 300 per cent of the daily performance or of the inverse of the daily performance, before fees and expenses, of the four Russell indices they benchmark.

The Direxion Shares ETFs seek to offer investment advisors and sophisticated investors the ability to execute active trading strategies in all types of markets. The funds deliver increased market exposure via threefold leverage, long and short of their respective indices, the highest level of leverage currently available in the ETF marketplace.

‘The eight leveraged index Bull and Bear ETFs will give our investors the ability to achieve increased exposure to the diversified Russell 1000, Russell 2000, Russell 1000 Energy and Russell 1000 Financial Services indices – critical investment tools for navigating changing markets,’ says Direxion Shares president Dan O’Neill.

The new ETFs are the Direxion Large Cap Bull 3x Shares, Direxion Small Cap Bull 3x Shares, Direxion Energy Bull 3x Shares, Direxion Financial Bull 3x Shares, Direxion Large Cap Bear 3x Shares, Direxion Small Cap Bear 3x Shares, Direxion Energy Bear 3x Shares and Direxion Financial Bear 3x Shares.

By providing both Bull and Bear versions of each index, Direxion seeks to give investors the ability to seek competitive returns in rising and falling markets across a wide spectrum of diversified assets. The ETF structure allows investors to benefit from the flexibility and low cost of an exchange-traded product, coupled with Direxion’s leveraged investment experience.

‘Our leveraged Bull and Bear ETFs offer an unprecedented level of leverage in the ETF arena, something that today’s dynamic investors are demanding,’ says Bill Franca, Direxion’s executive vice-president of sales and distribution. ‘Direxion Shares will give savvy investors the array of important investment options they have been seeking to actively capitalise on the volatility of today’s markets.’

The Large Cap and Small Cap Bull and Bear Funds have been listed on NYSE Arca. "We are thrilled to list the first Direxion Shares ETFs on NYSE Arca," says Lisa M. Dallmer, senir vice-president for global index and exchange-traded products at NYSE Euronext. "Today’s listing demonstrates NYSE Euronext’s growing breadth of issuer relationships and commitment to bringing some of the most uniquely designed funds to market."

Direxion Shares and Direxion Funds, managed by Rafferty Asset Management, offer leveraged index funds, ETFs and alternative-class fund products for investment advisors and sophisticated investors. Founded in 1997, the company has around USD1.6bn in assets under management.

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