GraniteShares 1.75x Long TSLA Daily ETF (TSLR)

Overview

The GraniteShares 1.75x Long TSLA Daily ETF (TSLL) seeks daily investment results, before fees and expenses, that correspond to 175% of the daily percentage change of the common stock of Tesla, Inc. It offers magnified exposure to Tesla's price movements. This ETF is not a diversified investment.

Reputation and Reliability

GraniteShares is a smaller ETF provider, but they are known for offering leveraged and inverse products. Their reliability depends on the investor understanding the risks associated with these types of ETFs.

Management Expertise

GraniteShares focuses on specialized ETF products, and the management team has experience in structuring and managing these types of leveraged investments.

Goal

To provide daily investment results (before fees and expenses) that correspond to 175% of the daily percentage change of Tesla (TSLA) stock.

Investment Approach and Strategy

Strategy: The ETF uses financial instruments such as swaps and futures contracts to achieve its leveraged exposure to TSLA stock on a daily basis.

Composition The ETF holds a mix of financial instruments designed to create the 1.75x leveraged exposure to TSLA. It does not directly hold TSLA shares but uses derivatives to achieve its objective.

Market Share: TSLL's market share within the leveraged single-stock ETF space is moderate, but it dominates the 1.75x long TSLA product category.

Total Net Assets (AUM): 100000000

Key Competitors

• Direxion Daily TSLA Bull 1.5X Shares (TSLL)
• CONVEXITYSHARES DAILY 1X TSLA (TSLA)

Competitive Landscape

The leveraged single-stock ETF market is relatively concentrated. TSLL has a first-mover advantage in the 1.75x long TSLA space. The primary disadvantage is the risk of compounding losses over time due to the leveraged nature of the fund. Competitors offer varying degrees of leverage or inverse exposure, catering to different risk appetites.

Historical Performance: The historical performance is highly dependent on TSLA's stock performance. Due to the leverage, daily gains and losses are magnified. Performance over longer periods can deviate significantly from 1.75x the cumulative return of TSLA due to the daily reset.

Benchmark Comparison: There is no direct benchmark. However, its performance is related to 1.75 times the daily performance of TSLA stock.

Expense Ratio: 0.99

Average Trading Volume

The average trading volume is generally moderate, but it can vary depending on market interest in TSLA.

Bid-Ask Spread

The bid-ask spread can be wider than more liquid ETFs due to the leveraged nature and the underlying volatility of TSLA stock.

Market Environment Factors

TSLL is heavily influenced by factors affecting Tesla's stock, including company-specific news, technological advancements, competition in the electric vehicle market, regulatory changes, and overall market sentiment towards growth stocks.

Growth Trajectory

The growth trajectory is directly tied to Tesla's stock performance. Changes to the ETF's strategy or holdings are not typically expected, as the objective is to maintain the 1.75x daily leverage to TSLA.

Competitive Edge

TSLL's competitive edge lies in its specific 1.75x leverage ratio, which caters to investors seeking magnified daily exposure to Tesla. The fund offers a more aggressive approach compared to unleveraged TSLA ETFs. However, its advantage is counterbalanced by the amplified risks inherent in leveraged instruments. The daily reset feature allows for tactical short-term positions, but it also means that long-term returns will not necessarily track 1.75x the cumulative return of TSLA over extended periods.

Volatility

TSLL is characterized by high volatility due to its leveraged nature. Investors should expect significant daily price swings, especially during periods of heightened market uncertainty.

Market Risk

The primary market risk is tied to the performance of TSLA stock. Any negative news or events impacting Tesla will be magnified in TSLL. Additionally, there is the risk of compounding losses and potential erosion of capital over time due to the daily reset of the leverage.

Ideal Investor Profile

TSLL is suitable for sophisticated investors with a high-risk tolerance who seek short-term tactical exposure to Tesla stock. It is not appropriate for long-term investors.

Market Risk

TSLL is best suited for active traders with a strong understanding of leveraged ETFs and the risks associated with them. It is not suitable for passive index followers or long-term investors due to the potential for significant value erosion over time.

The GraniteShares 1.75x Long TSLA Daily ETF (TSLL) offers leveraged exposure to the daily movements of Tesla stock, providing a magnified return for short-term tactical trading. Due to the daily reset and inherent leverage, the fund is extremely volatile and carries significant risk of capital erosion over longer time horizons. It is designed for sophisticated investors with a high-risk tolerance, not for long-term investment strategies. Investors should fully understand the compounding effects of daily returns in leveraged ETFs before investing. The expense ratio is relatively high, reflecting the complexities of managing a leveraged product.

Data Sources:

• GraniteShares website
• ETF.com
• Morningstar

Disclaimers:

This analysis is for informational purposes only and does not constitute financial advice. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Leveraged ETFs are inherently risky and may not be suitable for all investors.