VelocityShares Re-Launches Two Triple Leveraged Oil Funds To Replace Delisted Ones

Image of an oil derrick with blue sky

In a shocking turn of events, VelocityShares has responded to trader outrage over its closure of two popular triple leveraged oil ETNs by essentially re-launching them under slightly different tickers.

Citigroup is backing the two new products, dubbed VelocityShares 3x Long Crude Oil ETN (UWT) and VelocityShares 3x Inverse Crude Oil ETN (DWT), which launch today following yesterday’s delisting of UWTI and DWTI. Yes, you read that right. UWT and DWT will replace UWTI and DWTI.

So, why make the move at all? Because money, that’s why.

UWT and DWT will have higher expense ratios than their predecessors. The new products have management fees of 1.50%, versus UWTI and DWTI’s 1.35%. How Citigroup will justify the higher fees for what are essentially the exact same products remains to be seen, but it looks like they’re simply capitalizing on trader demand for the vacancy left by Credit Suisse’s decision to delist UWTI and DWTI.

To be clear, these two new products are not actually linked to the old ones in any way, so anyone still holding UWTI or DWTI — which still have hundreds of millions in assets between them — will need to contact Credit Suisse to figure out how to get their money out.

Stay tuned as this story continues to develop, in what has been quite a wild ride for these leveraged products over the past couple of months.