JNUG - XXXX Is Investing On Steroids: The Rise And Risks Of Leveraged ETNs
2024-03-20 14:20:22 ET
Summary
- ETF assets have grown at a 15% CAGR since 2010, outpacing traditional mutual funds.
- ETFs now offer both passive and active investment strategies, including leveraged and volatility-related products.
- The MAXTM SPX 500® 4X Leveraged ETN leverages the S&P 500 by 4x, but holding it long-term can lead to disappointing returns.
ETF assets under management have compounded at a 15% compound annual growth rate in 2010. According to Oliver Wyman , this is 3x faster than the growth of traditional mutual funds. At first ETFs were mostly associated with passive investment strategies. That's no longer necessarily the case, and there is an increasing amount of active strategies that are available through ETFs and ETNs. Lately, I'm fascinated by the leveraged and volatility-related products that are coming to the market. Some good, some bad. It is especially interesting to me what market impact they are potentially having or could have in the future (on further growth)....
XXXX Is Investing On Steroids: The Rise And Risks Of Leveraged ETNs