Direxion Daily Financial Bear 3X Shares (NYSE: FAZ) — This exchange-traded fund (ETF) seeks daily investment results, before fees and expenses, of 300% of the inverse of price performance of the Russell 1000 Financial Services Index. It typically creates short positions by investing at least 80% of its net assets in financial instruments that, in combination, provide leveraged and unleveraged exposure to the index.
FAZ has been consolidating in a downward channel following a low in late April at $12.50.
The recent reversal on Sept. 21 at $12.71 may have formed a double-bottom with that April low and, if confirmed, the trading target is $17.
An inverse ETF seeks to deliver the opposite of the performance of a benchmark, while a leveraged ETF seeks to deliver multiples of the performance of a benchmark. These ETFs entail unique risks, including, but not limited to: the use of leverage, aggressive and complex investment techniques, and the use of derivatives.
Keep in mind that, over longer periods, the returns for these products will likely differ in amount and even direction of the underlying. So they require active monitoring and management, as frequently as daily, and are not suitable for all investors.
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