Despite warnings that speed can kill, another leading alternative exchange-traded funds sponsor is preparing to jump into the super-leveraged exchange-traded funds race.
ProShares is requesting that the Securities and Exchange Commission allow it to provide up to 300% leverage and 300% inverse exposure to 37 different indexes.
Although it’s seeking so-called 3x approval for a list of some 94 new ETFs, it’s highly unlikely the leading leveraged and inverse provider will launch all in the near future.
But even if only a handful on the new list are brought to market, the filing opens the door for ProShares to at least enter the most juiced-up leverage game in ETFs at the moment.
And that has proved to be quite a lucrative undertaking for the lone sponsor to make the leap from 200% coverage—the previous high among leveraged ETFs.
Rival Direxion upped the ante late last year by becoming the first to offer ETFs that aim at taking 300% leverage and inverse positions. (See story here.)
The other major player in the leverage ETF field, Rydex, also is awaiting government approval for its 3X proposals.
Meanwhile, as ProShares and Rydex sit on the sidelines, Direxion is gaining significant first-mover status in the field.