What is a 2x leveraged ETF?

A 2x leveraged ETF aims to deliver twice the daily performance of its underlying index using borrowed money to magnify returns. To achieve this goal, a 2x leveraged ETF uses a combination of financial instruments, such as futures contracts, swaps, options and margin loans, to create leverage.

What is S&P 500 2x leverage daily?

The S&P 500 2X Leverage Daily reflects 200% of the return (positive or negative) of the S&P 500® including dividends and price movements. S&P Leveraged Indices are designed to generate a multiple of the underlying index return, minus the cost of borrowing capital to generate excess index exposure.

What are the risks associated with 2x leveraged ETFs?

Risks associated with 2x leveraged ETFs include: Amplified market volatility and potential losses: 2x leveraged ETFs can be risky as they use leverage to double daily performance. This can increase gains and losses, leading to greater losses if the market is unfavorable.