Direxion Shares ETF Trust - Direxion Daily AAPL Bear 1X Shares (AAPD)

Overview

The Direxion Daily AAPL Bear 1X Shares (AAPD) seeks daily investment results, before fees and expenses, of 100% of the inverse (or opposite) of the daily performance of the common shares of Apple Inc.

Reputation and Reliability

Direxion is a well-known provider of leveraged and inverse ETFs. They are generally considered reliable, but their products are complex and risky.

Management Expertise

Direxion has a dedicated team managing its ETFs, specializing in leveraged and inverse products. Their expertise lies in derivatives and managing daily resets.

Goal

To seek daily investment results, before fees and expenses, of 100% of the inverse (or opposite) of the daily performance of Apple Inc. stock.

Investment Approach and Strategy

Strategy: The ETF uses swaps, futures contracts, and other derivatives to achieve its daily inverse exposure to Apple Inc. stock.

Composition The ETF's assets primarily consist of derivative instruments designed to provide inverse exposure to Apple stock. It does not directly hold Apple shares.

Market Share: AAPD's market share within the single-stock inverse ETF space is dependent on investor sentiment towards Apple, but its overall share is relatively small compared to broad market ETFs.

Total Net Assets (AUM): 26460100

Key Competitors

• GraniteShares 1x Short AAPL Daily ETF (SAPP)

Competitive Landscape

The competitive landscape for single-stock inverse ETFs is evolving. Direxion and GraniteShares compete directly in this space, with each offering similar products targeting different stocks. AAPD's success depends on Apple's performance and investor appetite for inverse exposure. The primary differentiator between these funds is their expense ratio and tracking effectiveness.

Historical Performance: Due to the nature of leveraged and inverse ETFs, historical performance is highly dependent on the daily price movements of Apple stock. Long-term holding is generally not recommended.

Benchmark Comparison: There is no true benchmark, as the fund aims for a daily inverse return. Performance is typically compared against the inverse daily return of Apple stock.

Expense Ratio: 0.95

Average Trading Volume

The average trading volume varies but is typically moderate, reflecting interest in shorting Apple.

Bid-Ask Spread

The bid-ask spread can fluctuate depending on market conditions and trading volume, potentially impacting returns.

Market Environment Factors

AAPD is significantly affected by news, earnings reports, and overall market sentiment towards Apple. Economic indicators have an indirect impact.

Growth Trajectory

The fund's growth trajectory depends heavily on Apple's stock performance and investors' willingness to bet against it. There are no significant changes to strategy and holdings

Competitive Edge

AAPD offers a simple way to gain inverse exposure to Apple on a daily basis. It leverages Direxion's established expertise in providing geared and inverse ETFs. The fund's narrow focus appeals to traders with specific short-term views on Apple's stock, but is not meant for buy-and-hold investors. The ETF is advantageous for those who want to speculate or hedge against downside risk in Apple stock.

Volatility

AAPD is highly volatile due to its inverse leverage and the volatility of Apple stock. Daily resets can lead to significant erosion of value over time if held long-term.

Market Risk

The primary market risk is that Apple's stock will increase in value, leading to losses for the ETF. The ETF is also exposed to counterparty risk associated with the derivative instruments it uses.

Ideal Investor Profile

AAPD is suitable for sophisticated traders with a short-term negative outlook on Apple and a strong understanding of leveraged and inverse ETFs.

Market Risk

AAPD is designed for active traders and is not suitable for long-term investors or passive index followers.

The Direxion Daily AAPL Bear 1X Shares (AAPD) offers investors a way to profit from a short-term decline in Apple stock. It aims to deliver the inverse of Apple's daily performance, making it a tool for active traders and not buy-and-hold investors. The ETF carries significant risk due to its leveraged nature and daily reset mechanism. Due to the use of derivatives, and the need for daily rebalancing, this ETF carries significantly higher fees and risk compared to traditional ETFs.

Data Sources:

• DirexionShares.com
• SEC Filings
• Yahoo Finance

Disclaimers:

This analysis is for informational purposes only and does not constitute financial advice. Investing in leveraged and inverse ETFs involves significant risks, and investors should consult with a financial advisor before making any investment decisions. Market share data is estimated.