MicroSectors Travel -3X Inverse Leveraged ETNs (FLYD)

Overview

The MicroSectors Travel -3X Inverse Leveraged ETNs (FLYD) is designed to provide three times the inverse (opposite) of the daily performance of the Solactive MicroSectors U.S. Big Oil Index. It focuses on companies involved in the travel industry and uses leverage to amplify returns (and losses).

Reputation and Reliability

REX Shares is a provider of leveraged and inverse ETFs. They are known for offering sophisticated investment tools with higher risk and potential reward.

Management Expertise

REX Shares has a team experienced in structuring and managing leveraged and inverse ETFs. They understand the complexities and risks associated with these products.

Goal

FLYD seeks to provide three times the inverse of the daily performance of the Solactive MicroSectors U.S. Big Oil Index.

Investment Approach and Strategy

Strategy: It aims to provide -3x leveraged exposure to the performance of an index of U.S. companies in the travel industry.

Composition The ETN's value is linked to the performance of the Solactive MicroSectors U.S. Big Oil Index, achieved through financial instruments. The actual holdings consist of derivatives.

Market Share: FLYD holds a small market share compared to other travel sector ETFs due to its leveraged and inverse nature, which attracts a specific investor profile.

Total Net Assets (AUM): 1588000

Key Competitors

• JETS
• AWAY
• XLY

Competitive Landscape

The competitive landscape includes unleveraged travel ETFs like JETS and broader consumer discretionary ETFs. FLYD offers high potential returns but also high risk due to its leverage and inverse strategy. Its niche is short-term trading on a declining travel sector.

Historical Performance: Historical performance is highly volatile due to the leveraged and inverse nature. Past performance is not indicative of future results.

Benchmark Comparison: Performance is compared to -3x the daily return of the Solactive MicroSectors U.S. Big Oil Index. Due to the leveraged nature, long-term tracking can deviate significantly.

Expense Ratio: 0.95

Average Trading Volume

FLYD's average trading volume is relatively low, indicating potentially wider bid-ask spreads and difficulty in executing large trades.

Bid-Ask Spread

The bid-ask spread can be relatively wide, reflecting the ETN's leveraged nature and lower trading volume, increasing transaction costs.

Market Environment Factors

Economic downturns, travel restrictions (pandemics), and geopolitical events impacting the travel industry are major factors. Oil prices can affect the underlying Oil Index, impacting FLYD's returns.

Growth Trajectory

Growth depends on investors seeking short-term, leveraged inverse exposure to the travel industry. Changes in travel demand and consumer sentiment influence its use.

Competitive Edge

FLYD's advantage lies in its unique offering of -3x inverse leveraged exposure to the travel sector, enabling sophisticated investors to implement complex trading strategies. It allows for tactical shorting of the travel industry with amplified returns. It is designed for short-term trading rather than long-term investing. It caters to a specific niche of investors seeking aggressive, inverse exposure. The use of ETNs structure helps to mitigates tracking error in short term.

Volatility

FLYD exhibits very high volatility due to its leveraged and inverse structure. Investors should expect significant price swings.

Market Risk

Specific risks include the potential for amplified losses due to leverage, daily resets eroding long-term value, and the inherent risks of the travel industry (economic cycles, geopolitical events).

Ideal Investor Profile

The ideal investor is a sophisticated trader with a high-risk tolerance, a deep understanding of leveraged and inverse products, and a short-term investment horizon. These investors should have experience with derivatives.

Market Risk

FLYD is suitable for active traders seeking short-term tactical opportunities, not for long-term investors or passive index followers.

FLYD offers a highly leveraged and inverse exposure to the travel sector. It is designed for sophisticated traders seeking short-term tactical opportunities to profit from anticipated declines in the sector. The high volatility and risk make it unsuitable for long-term investment. Investors should carefully consider their risk tolerance and understand the complexities before investing. It is a niche product intended for short-term speculation.

Data Sources:

• REX Shares Website
• ETF.com
• Bloomberg
• Morningstar

Disclaimers:

This data is for informational purposes only and does not constitute financial advice. Investors should conduct their own due diligence before making any investment decisions. Leveraged and inverse ETFs are not suitable for all investors.