Direxion is set to begin trading the “Direxion Daily Semiconductor Bear 3X Shares” (SOXS) tomorrow March 11th. The Funds described in this Prospectus seek to provide daily leveraged investment results, before fees and expenses, which correspond to the performance of a particular index or benchmark. As used in this prospectus, the terms “daily,” “day,” and “trading day,” refer to the period from the close of the markets one trading day to the close of the markets on the next trading day. The Funds with the word “Bear” in their name (collectively, the “Bear Funds”) attempt to provide investment results that correlate negatively to the return of an index or benchmark, meaning that the Bear Funds attempt to move in the opposite or inverse direction of the target index or benchmark. The correlations sought by the Bull Funds and the Bear Funds are generally a multiple of the returns of the target index or benchmark. The benchmark for the Direxion Daily Semiconductor Bear 3X Shares is 300% of the inverse, or opposite, of the daily price performance of the PHLX Semiconductor Sector Index. If, on a given day, the PHLX Semiconductor Sector Index gains 1%, the Direxion Daily Semiconductor Bull 3X Shares is designed to gain approximately 3% (which is equal to 300% of 1%), while the Direxion Daily Semiconductor Bear 3X Shares is designed to lose approximately 3%. Conversely, if the PHLX Semiconductor Sector Index loses 1% on a given day, the Direxion Daily Semiconductor Bull 3X Shares is designed to lose approximately 3%, while the Direxion Daily Semiconductor Bear 3X Shares is designed to gain approximately 3%.
To pursue these results, the Funds listed above use aggressive investment techniques such as engaging in futures, swaps and options transactions. As a result, these Funds are designed principally for experienced investors who intend to follow an asset allocation strategy and are suitable for purchase by active investors as well as investors who engage in market timing activities. There is no assurance that the Funds will achieve their objectives and an investment in a Fund could lose money. No single Fund is a complete investment program.