Direxion Investments, a US-based provider of short and leveraged exchange-traded funds, has launched two pairs of ETFs which seek to deliver 2x long and 2x inverse exposure to the cyber security and pharmaceutical industries.
Direxion’s 2x Bull and Bear ETFs offer leveraged exposure to cyber security or pharmaceuticals companies.
These latest ETFs from Direxion offer investors a targeted exposure to two of the most hotly followed investment themes.
The rising threat of cyber crime has created increased demand for products from companies offering solutions which can prevent such attacks.
In the pharmaceutical and biotechnology space, breakthrough treatments and drugs, the successful switch to generics-based business models, and increased mergers and acquisitions activity have driven tremendous investor interest in the sector.
Short and leveraged ETFs such as these allow investors to amplify market returns or profit from falling prices. As such, the leveraged long products could be used to express long-term thematic view that companies within these industries will continue to see profit growth. Conversely, investors who view these companies as overvalued and expect them to underperform, particularly in a down market, could implement this shorter-term view with the 2x inverse ETFs.
“Traders and investors continue to express keen interest in the cyber security and pharmaceutical sectors,” said Sylvia Jablonski, Managing Director at Direxion. “Our new leveraged ETFs enable traders to benefit from exposure to these industries, regardless of market conditions and sector performance, in a flexible way.”
The Direxion Daily Cyber Security Bull and Bear 2X Shares (Tickers: HAKK/HAKD) seek to achieve 200% and 200% of the inverse, respectively, of the daily performance of the ISE Cyber Security Index. The index is comprised of domestic and foreign companies that are cyber security infrastructure providers (hardware/ software developers) or that provide cyber security services, and for whom cyber security is a key driver of the company’s business
The Direxion Daily Pharmaceutical & Medical Bull and Bear 2X Shares (Tickers: PILL/PILS) seek to achieve 200% and 200% of the inverse, respectively, of the daily performance of the Dynamic Pharmaceutical Intellidex Index. The index consists of common shares of US pharmaceutical and biotechnology companies. These companies are principally engaged in research, development, manufacture, sale or distribution of pharmaceuticals and drugs of all types.
The funds have been listed on the NYSE Arca and carry a 0.80% net expense ratio which will stay in place until 1 September 2017. The funds’ gross expense ratios (GER) are listed below:
Direxion Daily Cyber Security Bull 2X Shares (HAKK) GER: 1.15%
Direxion Daily Cyber Security Bear 2X Shares (HAKD) GER: 0.96%
Direxion Daily Pharmaceutical & Medical Bull 2X Shares (PILL) GER: 1.11%
Direxion Daily Pharmaceutical & Medical Bear 2X Shares (PILS) GER: 0.96%