Trend of leveraged single stock ETFs gets new player in GraniteShares
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GraniteShares has jumped into the growing trend of leveraged single stock ETFs, adding to a market that has gained steam lately from the announcement of similar products developed by Direxion Funds.
As part of the plan, GraniteShares has submitted a prospectus with the U.S. Securities and Exchange Commission that covers 20 different ETFs. The planned investment vehicles will allow investors to take a +2X approach on 19 stocks, including mega-cap names and other popular household stocks. This includes names like Apple (NASDAQ:AAPL), Tesla (NASDAQ:TSLA), Amazon (NASDAQ:AMZN), Disney (NYSE:DIS) and Ford (NYSE:F).
In addition, one of the ETFs is a -1X inverse fund that trades against Tesla (TSLA).
See below a list of each ETF:
GraniteShares 2x Long Tesla Daily ETF
GraniteShares 1x Short Tesla Daily ETF
GraniteShares 2x Long NVIDIA Daily ETF
GraniteShares 2x Long NIO Daily ETF
GraniteShares 2x Long Coinbase Daily ETF
GraniteShares 2x Long Moderna Daily ETF
GraniteShares 2x Long Alibaba Daily ETF
GraniteShares 2x Long Meta Platforms Daily ETF
GraniteShares 2x Long Alphabet Daily ETF
GraniteShares 2x Long Amazon Daily ETF
GraniteShares 2x Long Apple Daily ETF
GraniteShares 2x Long Microsoft Daily ETF
GraniteShares 2x Long AMD Daily ETF
GraniteShares 2x Long Palantir Daily ETF
GraniteShares 2x Long Twitter Daily ETF
GraniteShares 2x Long Uber Daily ETF
GraniteShares 2x Long Tilray Daily ETF
GraniteShares 2x Long Peloton Daily ETF
GraniteShares 2x Long Disney Daily ETF
GraniteShares 2x Long Ford Daily ETF
The 1X Short Tesla Fund plans to deliver market participants a -100% daily return on the underlying stock. In contrast, the other 2X Long ETFs will provide a +200% daily return on the specific underlying stock.
Therefore, if Tesla falls by $1, the accompanying 1X Short Fund will rise by nearly $1 for a single day. Moreover, if the Long 2X Funds underlying stock rises by $1, the ETF in turn will increase by nearly $2 for a single day.
In order for the exchange traded funds to achieve their investment objectives, the funds will invest primarily in financial instruments, such as swap agreements, that provide leveraged and inverse exposure to the specific stock it plans to cover.
The move by GraniteShares comes shortly after Direxion Funds filed for similar ETFs that included mega-cap names.