Direxion Launches New 3x Leveraged Emerging Markets Bond Fund

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August 18, 2017 9:34am NYSE:FAS

NYSE:FAS | News, Ratings, and Charts

ETF issuer Direxion, which specializes in leveraged, inverse, and leveraged inverse funds, recently filed for another leveraged product targeting outsized emerging market bond returns.

The Direxion Daily Emerging Markets Bond Bull 3X Shares (EMBU) will offer triple exposure to the J.P. Morgan Custom Emerging Markets Bond Index.

The fund is listed on the NYSE Arca exchange with a 1.07% expense ratio. Those high fees are typical of leveraged funds, since they cost more money to operate and maintain.

Rhe SEC filing contains the usual disclaimer about how these daily funds are not suitable for long-term investments:

The Fund is not suitable for all investors. The Fund is designed to be utilized only by knowledgeable investors who understand the potential consequences of seeking daily leveraged investment results, understand the risks associated with the use of leverage and are willing to monitor their portfolios frequently. The Fund is not intended to be used by, and is not appropriate for, investors who do not intend to actively monitor and manage their portfolios. An investment in the Fund is not a complete investment program.

Direxion’s current largest fund, the $1.5 billion Direxion Daily Financial Bull 3X Shares (NYSE:FAS), fell $0.01 (-0.02%) in premarket trading Friday. Year-to-date, FAS has gained 21.88%, versus a 9.84% rise in the benchmark S&P 500 index during the same period.

FAS currently has an ETF Daily News SMART Grade of B (Buy), and is ranked #27 of 75 ETFs in the Leveraged Equities ETFs category.

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