Leverage Shares rolls out new tactical ETPs on LSE

Jun 15th, 2022 | By | Category: Alternatives / Multi-Asset

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Leverage Shares has rolled out several new ETPs on London Stock Exchange providing tactical exposure to individual commodities and country-specific equity indices.

Leverage Shares rolls out new tactical ETPs on LSE

Inverse and leveraged ETPs offer an efficient means to hedge positions or take out tactical exposures.

The commodity-focused ETPs provide triple leveraged (+300%) or inverse triple leveraged (-300%) exposure to gold or silver, as well as double leveraged (+200%) or inverse double leveraged (-200%) exposure to West Texas Intermediate crude oil.

The equities-focused ETPs, meanwhile, provide triple leveraged (+300%) or inverse triple leveraged (-300%) exposure to the stock markets of South Korea (as referenced by the MSCI South Korea Index), China (MSCI China), Taiwan (MSCI Taiwan), Japan (MSCI Japan), Germany (DAX), and the US (Nasdaq 100 or S&P 500).

Historically, inverse and leveraged ETPs have typically used derivatives, such as swaps, to achieve their geared exposure, introducing credit risk to investors.

Leverage Shares ETPs, however, do away with credit risk. Each ETP invests in liquid, third-party ETFs that provide the desired exposure, using margin loans to leverage the ETP’s position as required. Residual cash, such as dividends from the underlying ETFs, is also reinvested.

According to Leverage Shares, the firm’s ability to access margin borrowing at institutional rates allows it to offer its products to investors at a competitive rate. Each ETP comes with a management fee of 0.75%.

Inverse and leveraged ETPs can be considered inappropriate for retail investors who perhaps might not fully understand the risks involved. Specifically, these products tend to decay in value if held for an extended period of time, potentially leading to significant losses, especially in volatile but range-bound markets.

For sophisticated traders, however, they can offer an efficient means to hedge existing positions or take out new tactical exposures.

The new listings are outlined below:

Leverage Shares 3x Long Gold ETP
Leverage Shares -3x Short Gold ETP

Leverage Shares 3x Long Silver ETP
Leverage Shares -3x Short Silver ETP

Leverage Shares 2x Long WTI Oil ETP
Leverage Shares -2x Short WTI Oil ETP

Leverage Shares 3x Long South Korea ETP
Leverage Shares -3x Short South Korea ETP

Leverage Shares 3x Long China ETP
Leverage Shares -3x Short China ETP

Leverage Shares 3x Long Taiwan ETP
Leverage Shares -3x Short Taiwan ETP

Leverage Shares 3x Long Japan ETP
Leverage Shares -3x Short Japan ETP

Leverage Shares 3x Long Germany 40 ETP
Leverage Shares -3x Short Germany 40 ETP

Leverage Shares 3x Long US Tech 100 ETP
Leverage Shares -3x Short US Tech 100 ETP

Leverage Shares 3x Long US 500 ETP
Leverage Shares -3x Short US 500 ETP

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