Direxion Daily NFLX Bear 1X Shares (NFXS)

Overview

The Direxion Daily NFLX Bear 1X Shares (NFLD) seeks daily investment results, before fees and expenses, of 100% of the inverse (or opposite) of the daily performance of Netflix (NFLX) stock. It targets investors who believe Netflix's stock price will decline on a given day and are looking for short-term leveraged exposure. The fund primarily uses derivatives to achieve its investment objective.

Reputation and Reliability

Direxion is a well-known issuer of leveraged and inverse ETFs, with a track record of providing these types of products to the market.

Management Expertise

Direxion has a dedicated team experienced in managing leveraged and inverse ETFs, which require expertise in trading and risk management.

Goal

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

Investment Approach and Strategy

Strategy: The ETF uses a derivatives-based strategy to achieve its daily inverse leverage to Netflix stock's performance.

Composition The ETF primarily holds financial instruments such as swap agreements, futures contracts, and options to achieve its leveraged inverse exposure to Netflix stock. It may also hold a small amount of cash or cash equivalents.

Market Share: NFLD's market share in the single-stock leveraged/inverse ETF segment is relatively small due to the niche nature of these products.

Total Net Assets (AUM): 19310000

Key Competitors

• GraniteShares 1.75x Short NVDA Daily ETF (NVDL)
• GraniteShares 1.75x Short TSLA Daily ETF (TSDD)

Competitive Landscape

The competitive landscape for single-stock leveraged and inverse ETFs is evolving. NFLD competes with other single-stock ETFs that offer leveraged or inverse exposure to individual companies. NFLD's advantage is its specific focus on Netflix, while its disadvantage is its limited scope compared to broader market ETFs or ETFs that cover multiple technology companies. The presence of other similar products dilutes the market share.

Historical Performance: Historical performance is characterized by high volatility and should inversely mirror the performance of Netflix on a daily basis, before fees and expenses. Past performance is not indicative of future results, especially for leveraged/inverse products.

Benchmark Comparison: The ETF does not track a traditional benchmark index but rather aims to deliver the inverse of Netflix's daily performance. Performance is best compared to -1x the daily return of NFLX.

Expense Ratio: 0.95

Average Trading Volume

The ETF's average trading volume can vary, but is generally moderate, reflecting the specific nature of the leveraged inverse product; it averages roughly 35.97K shares daily.

Bid-Ask Spread

The bid-ask spread can fluctuate depending on market conditions and trading volume, reflecting the cost of trading.

Market Environment Factors

The ETF's performance is closely tied to Netflix's stock performance and is impacted by news and events related to the company, consumer behavior, and broader market sentiment affecting the technology sector.

Growth Trajectory

The ETF's growth trajectory depends on investor demand for leveraged inverse exposure to Netflix. Changes in sentiment around Netflix and the broader economy can drive both positive and negative growth of the fund.

Competitive Edge

NFLD offers a specific and direct way for investors to bet against Netflix on a daily basis with 1x leverage. Its competitive advantage lies in being one of the few dedicated inverse ETFs focused solely on Netflix. Its tight focus can be both an advantage (for targeted exposure) and a disadvantage (limiting diversification). It can offer short-term tactical opportunities for sophisticated investors.

Volatility

The ETF is highly volatile due to its leveraged nature and the volatility of Netflix stock. Leveraged ETFs are not suitable for all investors.

Market Risk

The primary risk is the inverse performance of Netflix, meaning if Netflix's stock price increases, the ETF's value will decrease. Compounding can also affect returns, especially over longer holding periods.

Ideal Investor Profile

NFLD is suited for sophisticated investors with a high-risk tolerance who understand the complexities of leveraged and inverse ETFs and have a short-term outlook on Netflix.

Market Risk

The ETF is designed for active traders with a short-term strategy and is not suitable for long-term investors or passive index followers. It's a tactical tool for those with a bearish outlook on Netflix.

Direxion Daily NFLX Bear 1X Shares (NFLD) offers investors leveraged inverse exposure to Netflix stock on a daily basis. It is designed for sophisticated, active traders with a short-term, bearish outlook on Netflix. Due to its leveraged nature and the volatility of Netflix, the fund carries significant risk and is unsuitable for long-term investors. The ETF provides a tactical tool for those looking to profit from short-term declines in Netflix's stock price.

Data Sources:

• Direxion
• SEC Filings
• Yahoo Finance
• Bloomberg

Disclaimers:

This analysis is for informational purposes only and does not constitute investment advice. Leveraged and inverse ETFs are complex financial instruments and may not be suitable for all investors. Past performance is not indicative of future results. Consult with a qualified financial advisor before making any investment decisions.