Introduction to Leveraged ETFs
Leveraged ETFs use derivatives and borrowing to amplify the return of an underlying index. They target a multiple such as 2× or 3× of the index's daily performance.
Who this site is for
This site is for people who want to understand leveraged ETFs and already know the basics of regular ETFs. If that is not you yet, learn about regular index ETFs first because leveraged products are substantially more volatile and risky.
If you already understand regular ETFs and index investing, you are in the right place.
Recommended Steps
Start with the backtesting tool to see how leverage changes returns. Then learn how volatility decay makes multi-day performance differ from a simple 2× or 3× calculation.
A Note On Psychology
Leveraged ETFs can outperform regular ETFs, but their amplified losses and volatility are psychologically difficult to withstand. A strategy only works if you understand its risks and can follow it through bear markets. Tell us if information you need for an informed decision is missing.