Megacap names have worst start to the year since 2008 and these ETNs are feeling it
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Megacap names are off to their worst start since at least 2008 and a handful of names have had their poorest start to a year on record. Amid this weakness, three exchange traded notes by MicroSectors that have concentrated portfolios towards FAANG and other megacap names have been crushed.
The MicroSectors FANG+ ETN (NYSEARCA:FNGS) is a fund that is built up from ten equally weighted holdings, meaning each stock receives a 10% weighting. The ETN has declined 36.2% so far in 2022.
Four of the FNGS components are off to their worst trading start since 2008. Amazon (AMZN) is down -36.8% YTD, Microsoft (MSFT) -22.5%, Alphabet (GOOG) (GOOGL) -21.6%, and Apple (AAPL) -17.5%.
Furthermore, FNGS has three other megacap names that have each started the trading year off to the worst on record. These names include Netflix (NFLX) -72.4%, Meta Platforms (FB) -43.9%, and Tesla (TSLA) -30.5%.
In addition, the leveraged versions of FNGS have shown even larger losses on the year. MicroSectors FANG+ Index 2X Leveraged ETN (NYSEARCA:FNGO) is -62.5% to start the year and the MicroSectors FANG+ Index 3X (NYSEARCA:FNGU) has crashed -79.7%.
While megacap names have struggled, MicroSectors does offer the investment community a 3X inverse leveraged fund that capitalizes when these names trade lower. The MicroSectors FANG+ Index -3X Inverse Leveraged ETN (NYSEARCA:FNGD) has answered the call and surged 132.1% in 2022.
Investors may also be in for more turmoil ahead as the stock index futures point to a lower open Thursday.