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Winning Leveraged ETFs of the Final Week of 2020

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Wall Street saw a mixed performance last week probably because of rising COVID-19 cases globally while a stimulus deal cheered up the market. The S&P 500 and the Dow Jones added about 0.5% and 0.6%, respectively, in the past five days (as of Dec 31, 2020) while the Nasdaq Composite lost about 0.1%.

Against this backdrop, below we highlight a few leveraged ETFs that bucked the feeble trend last week and soared successfully.

ETFs in Focus

Direxion Daily S&P Biotech Bear 3X Shares (LABD - Free Report) ) – Up 22.6%

The underlying S&P Biotechnology Select Industry Index is designed to measure the performance of a sub-industry or group of sub-industries determined based on the Global Industry Classification Standards (GICS). The fund offers three times inverse exposure to the index. The expense ratio of the fund is 1.06%.

Direxion Daily MSCI South Korea Bull 3x Shares (KORU - Free Report) ) – Up 20.1%

The underlying MSCI Korea 25-50 Index measures the performance of the large and mid-cap segments of the South Korea equity market, covering approximately 85% of the free float-adjusted market capitalization in South Korea. The fund offers two times bullish exposure to the index. The fund’s expense ratio is 1.29% (read: 5 Best-Performing Leveraged ETFs of Fourth Quarter).

South Korean stocks have been steady lately. The U.S.stimulus hopes and the ongoing coronavirus vaccine rollout has boosted sentiments.  The country’s exchange outperformed China’s and Japan’s in the first nine months of this year. The country’s efficient handling of the coronavirus pandemic has also been a key driver of the market rally.     

Direxion Daily Utilities Bull 3X Shares (UTSL - Free Report) ) – Up 9.6%

Utilities probably gained on two prospects. A likely market correction in 2021, which brightened the allure for utility stocks as well as a green energy boom may have acted as a tailwind.

The underlying Utilities Select Sector Index includes domestic companies from the sector which includes the following industries: electric utilities; multi-utilities; water utilities; independent power producers and energy trades; and gas utilities. The fund UTSL offers thrice the exposure to the index. The expense ratio of the fund is 0.99%.

Direxion Daily CSI 300 China A Share Bull 2X Shares (CHAU - Free Report) ) – Up 9.2%

The underlying CSI 300 Index is a modified free-float market-capitalization weighted index comprising the largest and most-liquid stocks in the Chinese A-share market. The expense ratio of the fund is 1.21%.

China stocks touched multi-year highs to leave 2020. The gains came on the heels of a Sino-Europe investment deal and Beijing's policy support for its capital markets. The European Union and China agreed last week to an investment deal that will give European companies greater access to Chinese markets and help compensate for what Europe views as unbalanced economic ties. China’s economy’s fast rebound from the coronavirus pandemic has also acted as a boon to its markets.

Direxion Daily Semiconductor Bull 3X Shares (SOXL - Free Report) ) – Up 7.9%

The underlying PHLX Semiconductor Sector Index measures the performance of the semiconductor sub-sector of the U.S. equity market. The fund charges 96 bps in fees. This three-times leveraged ETF gained on the back of inherent strength in the semiconductor segment.

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