Direxion’s leveraged exchange-traded funds (ETFs) provided stellar returns in 2017. Based solely on performance through Dec. 21, 2017, Direxion manages the ETF investing market’s top three funds by return.
The funds’ investments span three categories: homebuilders and supplies, semiconductors, and internet companies in China. All three funds have achieved returns of greater than 150% using leveraged strategies.
Investors should note that this kind of ETF can be quite volatile. Therefore, leveraged ETFs do carry more risk than traditional portfolio investment strategies. Also worth noting, these Direxion funds seek to match a multiple of the intended return for a single day. Thus, the strategy is focused on single-day returns and not cumulative returns.
All figures are as of Dec. 21, 2017.
Direxion Daily Homebuilders & Supplies Bull 3X Shares (NAIL)
YTD Return: 252.08%
Average Volume: 59,423
Assets under Management: $75.7 million
The Direxion Daily Homebuilders & Supplies Bull 3X Shares ETF takes a bullish position on U.S. housing construction and suppliers. The fund seeks to replicate the performance of the Dow Jones U.S. Select Home Construction Index, multiplied by three. This index includes U.S. home construction companies, as well as suppliers of building materials and home furnishings. The fund achieves its intended returns by investing at least 80% of its net assets in financial instruments and/or ETFs that provide exposure to the index. The fund has benefited from the recovering housing market. Top holdings in the Index include DR Horton Inc., Lennar Corp., NVR Inc., PulteGroup Inc., Toll Brothers Inc., Home Depot Inc. and Lowe’s.
Direxion Daily Semiconductor Bull 3X Shares (SOXL)
YTD Return: 161.55%
Average Volume: 560,455
Assets under Management: $685.8 million
The Direxion Daily Semiconductor Bull 3X Shares ETF takes a bullish position on semiconductor stocks. The fund seeks to replicate the performance of the PHLX Semiconductor Sector Index multiplied by three. The index includes U.S. companies with operations involving design, distribution, manufacture and sale of semiconductors. A growing economy with an increased focus on technology has helped this fund. The fund invests at least 80% of its net assets in financial instruments and/or ETFs that provide exposure to the index. The three top constituents in the PHLX Index include Intel, Texas Instruments and NVIDIA Corp.
Direxion Daily CSI China Internet Index Bull 2x Shares (CWEB)
YTD Return: 161.39%
Average Volume: 69,163
Assets under Management: $100.3 million
The Direxion Daily CSI China Internet Index Bull 2x Shares takes a bullish position on the growing internet sector in China. The fund seeks to replicate the performance of the CSI Overseas China Internet Index, multiplied by two. It invests at least 80% of its net assets in financial instruments and/or ETFs that provide exposure to the index. The index includes publicly traded Chinese companies that generate revenue primarily from internet and internet-related business activities. China’s growing middle class has been a significant driver of revenue for these growing companies, with further demand expected to continue into 2018 and beyond. Top holdings in the index include Alibaba Group Holding Ltd., Tencent Holdings Ltd., Baidu Inc. and JD.com.