ETF Securities is launching Europe’s first complete platform of exchange-traded funds tracking double leveraged and double short benchmarks based off Europe’s main equity indices – the
ETF Securities is launching Europe’s first complete platform of exchange-traded funds tracking double leveraged and double short benchmarks based off Europe’s main equity indices – the Dow Jones Euro Stoxx 50, the FTSE 100, the Cac 40 and the Dax.
The new ETFs track double leveraged (2x) and double short (-2x) equity indices, which provide 2x long or 2x short exposure to the daily percentage return of various benchmarks through an ETF, allowing investors to express directional views on major European equities.
The ETFs are intended for investors who do not wish to use derivatives to set up short-term leveraged directional strategies. They can also be used to hedge a portfolio or to implement market neutral, long-short and pairs trading strategies.
The products also allow traditional long managers, including Ucits funds, to use leveraged long and leveraged inverse strategies without the need to enter into complex and costly stock loan arrangements.
The new double leveraged and double short ETFs complement the existing platform of 13 equity ETFs providing exposure to global and European themes such as alternative energy, water, agribusiness, coal, steel, shipping and nuclear power.
ETFs tracking double leveraged equity indices allow investors to earn a positive return when the index is rising with 50 per cent less capital. They seek to deliver a leveraged return which corresponds to twice the daily percentage change in the level of the underlying index (excluding fees and other costs).
ETFs tracking double short equity indices allow investors to earn a leveraged positive return when the index is falling with 50 per cent less capital. They seek to deliver the inverse of twice the daily percentage change in the level of the underlying index (excluding fees and other costs).
Mark Weeks, chief executive of the ETF Exchange, says: ‘I am very excited by this offering ETF Securities is bringing to the market. It is a very valuable additional tool set that all investors will be able to access. Many investors are looking for safe and secure products that provide very liquid market exposure and these products do just that.’
