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, of 1.75 times (175%) the daily percentage change of the common stock of Tesla, Inc. It's designed for sophisticated investors seeking magnified exposure to Tesla stock.

Reputation and Reliability

GraniteShares is a smaller ETF provider specializing in leveraged and inverse products. Their reputation is tied to the performance and management of these high-risk instruments.

Management Expertise

GraniteShares' management team has experience in structured products and derivatives, necessary for managing leveraged ETFs.

Goal

To provide 1.75 times the daily percentage change of Tesla (TSLA) stock.

Investment Approach and Strategy

Strategy: This ETF uses derivatives, primarily swap agreements, to achieve its leveraged exposure to Tesla's stock. It rebalances daily to maintain the 1.75x leverage.

Composition The ETF primarily holds swap agreements linked to the performance of Tesla stock, with some cash holdings for collateral and operational needs.

Market Share: The market share is relatively niche within the leveraged ETF space focused on single stocks.

Total Net Assets (AUM): 93321925

Key Competitors

• Direxion Daily TSLA Bull 1.5X Shares (TSLL)
• AXS TSLA Bear Daily ETF (TSLQ)

Competitive Landscape

The leveraged ETF market is highly competitive, with several providers offering similar products on popular stocks. TSLL faces competition from other leveraged Tesla ETFs, with differentiation primarily based on leverage ratio and expense ratio. Its advantages might include a slightly higher leverage multiple, while disadvantages stem from the inherent risks of leveraged products and potential tracking error.

Historical Performance: Historical performance is highly dependent on Tesla's stock performance. Due to the leverage, both gains and losses are amplified. Long-term performance can be significantly impacted by compounding effects.

Benchmark Comparison: A direct comparison to a benchmark is difficult as it aims for 1.75x daily returns, not long-term index tracking. Performance should be compared to 1.75x the daily returns of TSLA.

Expense Ratio: 0.99

Average Trading Volume

The average trading volume is moderate, offering reasonable liquidity for most investors, but it can fluctuate with market interest in Tesla.

Bid-Ask Spread

The bid-ask spread can be wider than traditional ETFs, reflecting the higher risk and specialized nature of the product.

Market Environment Factors

Tesla's stock performance is heavily influenced by factors such as electric vehicle demand, technological advancements, regulatory changes, and overall market sentiment. These factors directly impact TSLL's performance.

Growth Trajectory

The growth trajectory of TSLL is dependent on the sustained interest in and volatility of Tesla stock. Changes in Tesla's fundamentals or market sentiment can significantly impact the ETF's holdings and strategy.

Competitive Edge

TSLL's competitive advantage lies in its specific leverage ratio, catering to investors seeking aggressive short-term gains on Tesla. It offers a higher leverage than some competitors, appealing to risk-tolerant traders. The ETF's daily reset mechanism, while intended to track the daily multiple, can lead to significant deviations over longer periods due to compounding, which some investors may exploit for short-term strategies. However, this same mechanism can also be a substantial disadvantage for long-term holders.

Volatility

TSLL exhibits extremely high volatility due to the leveraged exposure. It is significantly more volatile than Tesla stock itself.

Market Risk

The primary market risk is the volatility of Tesla stock. Additionally, there's the risk of compounding errors due to the daily reset and the potential for significant losses, including complete loss of investment, due to the leverage.

Ideal Investor Profile

The ideal investor is a sophisticated, risk-tolerant trader with a short-term outlook on Tesla. They understand the risks of leveraged ETFs and are actively managing their positions.

Market Risk

This ETF is suitable for active traders seeking short-term tactical exposure to Tesla and is unsuitable for long-term investors or those with a low-risk tolerance.

GraniteShares 1.75x Long TSLA Daily ETF (TSLL) provides leveraged daily exposure to Tesla's stock, targeting sophisticated traders seeking amplified short-term gains. It employs a daily reset mechanism, making it unsuitable for long-term holding due to potential compounding errors. The ETF's performance is highly volatile and dependent on Tesla's stock, exposing investors to substantial risk. It is crucial to understand the mechanics of leveraged ETFs before investing in TSLL, as losses can be significant and rapid. This product is suitable for those with a high-risk tolerance and active management strategy.

Data Sources:

• GraniteShares website
• ETF.com
• Morningstar
• SEC Filings

Disclaimers:

The information provided is for informational purposes only and should not be considered investment advice. Investing in leveraged ETFs involves significant risks, including the potential for complete loss of investment. Past performance is not indicative of future results. Consult with a qualified financial advisor before making any investment decisions.