Last week, the leveraged/inverse ETF world was mostly influenced by rising homebuilder confidence, GOP nearing another step toward tax reform, higher oil prices and lower gold prices. ETFs that gained and lost the most last week had a co-relation with these events. Let’s take a look at some top and worst-performing leveraged/inverse ETFs to check the top and worst players in the market right now (read: GOP Nears Tax Reform: Buy These ETFs):
Direxion Daily Homebuilders &Suppliers Bull 3X ETF (NAIL - Free Report) – Up 8.8%
Homebuilder confidence increased to a six-month high in October, probably as an after-effect of an hurricane-induced slide. A monthly sentiment index from the National Association of Home Builders increased 4 points to 68 in October, the highest level since May. A reading higher than 50 is seen as upbeat sentiment. The index was 63 in October 2016, as per CNBC.
The product seeks 300% of the performance of the Dow Jones U.S. Select Home Construction Index.
AxelaTrader 3x Long Brent Crude Oil ETN (UBRT - Free Report) – UP 8.1%
Oil prices gave positive cues thanks to supply concerns in the Middle East and the United States. Signs of tightening on the production front and rising demand in Asia helped oil prices last week.
The Credit Suisse AxelaTrader 3x Long Brent Crude Oil ETNs looks to give exposure to three times the daily performance of the S&P GSCI Brent Crude Oil ER. Expense ratio of the product is 1.35%.
Direxion Daily Regional Banks Bull 3X ETF (DPST - Free Report) – Up 6.7%
The 10-Year U.S. benchmark boons yields rose from 2.30% on Oct 16 to 2.39% on Oct 20. This increase in yields benefited leveraged regional banking ETFs as financial stocks perform better in a rising rate environment (read: 5 ETFs to Buy and Hold for 5 Years).
Plus, as per an article published on CNBC, a senior analyst at AB Bernstein noted that “large banks likely would see 2018 earnings per share jump by 12 to 20 percent, while midcaps would see growth of 15 to 25 percent” if Trump tax cut plan is enacted. Compared with the other sectors, the gain from tax reforms for large-cap banks would be in the 4% to 12% range while small-caps would see a boost of 7% to 17%, according to the article published on CNBC (read: ETFs to Benefit from Trump Tax Plan).
This $29.4-million fund seeks to deliver thrice the returns of the S&P Regional Banks Select Industry Index, charging 96 bps in fees per year.
Direxion Daily Junior Gold Miners Index Bull 3x Shares (JNUG - Free Report) – Down 11.3%
As rates rose and markets became steady, gold prices came under slight pressure, putting further pressure on gold mining stocks and ETFs.
The Daily Junior Gold Miners Index Bull 3x shares seeks daily investment results of 300% of the performance of the Market Vectors Junior Gold Miners Index. The $745.5-million fund charges 95 bps in fees.
VelocityShares Daily 2x VIX Short Term ETN (TVIX - Free Report) – Down 9.1%
As stocks were upbeat, volatility levels were lower. The ETN is senior, unsecured obligations of Credit Suisse. Its returns are linked to 2x the daily performance of the S&P 500 VIX Short-Term Futures Index less the investor fee. The product gives traders an opportunity to express their market views on the short-term futures contracts on the CBOE SPX Volatility Index.
Direxion Daily MSCI Brazil Bull 3X ETF (BRZU - Free Report) – Down 7.2%
Brazil stocks declined on political upheaval. Lawmakers discussed if President Michel Temer should be put on trial before the Supreme Court, which can act as a threat to his pro-reform schemes. As a result, BRZU, which looks to track the thee times performance of the MSCI Brazil 25/50 Index, lost about 7.2%.
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