A new filing by Direxion Funds could seriously up the ante in the realm of leveraged exchange-traded funds. The firm, which is known for its leveraged index mutual funds, has filed 36 proposed ETFs with the Securities and Exchange Commission.
There's been a lot of activity in the leveraged funds market lately, but these funds take the concept to the next level - they offer three times the performance (or three times the inverse) of the daily performance of the indexes they are tied to. This means that the proposed Direxion S&P 500 Bear 3X Shares, for example, will offer three times the inverse of the daily performance of the S&P 500. Currently, available ETFs offer no more than double exposure to their underlying indexes, whether they be leveraged or inverse funds.
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