T-Rex 2X Inverse Tesla Daily Target ETF (TSLZ)

Overview

The T-Rex 2X Inverse Tesla Daily Target ETF (TSDD) aims to provide twice the inverse of the daily performance of Tesla (TSLA) stock. It is designed for sophisticated investors seeking short-term, leveraged exposure to the price movements of Tesla shares.

Reputation and Reliability

T-Rex is a relatively new ETF issuer. Their reputation is still developing and requires close monitoring.

Management Expertise

The management team's expertise focuses on creating and managing leveraged and inverse ETFs, catering to niche market segments.

Goal

The primary investment goal of TSDD is to deliver twice the inverse (opposite) of the daily return of Tesla (TSLA) stock.

Investment Approach and Strategy

Strategy: TSDD employs a leveraged strategy, utilizing financial derivatives such as swaps and futures contracts to achieve its 2x inverse exposure to Tesla.

Composition TSDD's assets consist primarily of derivatives contracts linked to Tesla's stock performance. Cash and other short-term instruments are used for collateral and managing the fund's daily rebalancing.

Market Share: TSDD occupies a niche market segment within the leveraged/inverse ETF space, specifically targeting Tesla's stock.

Total Net Assets (AUM): 3648831

Key Competitors

• Direxion Daily TSLA Bear 1X ETF (TSLS)

Competitive Landscape

The competitive landscape is limited due to the specificity of the fund's objective. TSDD's 2x leverage distinguishes it from TSLS. Advantages of TSDD include higher potential returns (and losses) for those betting against Tesla. A disadvantage is the increased risk and volatility due to leverage.

Historical Performance: Historical performance is highly dependent on Tesla's stock performance and should be viewed with caution due to the leveraged nature of the fund.

Benchmark Comparison: Due to the leveraged and inverse nature, direct benchmark comparison is not straightforward. Performance should be evaluated against -2x the daily return of TSLA.

Expense Ratio: 0.95

Average Trading Volume

The average trading volume of TSDD indicates moderate liquidity, impacting the ease of buying and selling shares without significantly affecting the price.

Bid-Ask Spread

The bid-ask spread for TSDD varies based on market conditions and trading volume but is generally wider than more liquid ETFs due to its leveraged and inverse nature.

Market Environment Factors

TSDD's performance is heavily influenced by news, sentiment, and events surrounding Tesla, as well as broader market conditions affecting the electric vehicle and technology sectors.

Growth Trajectory

Growth is dependent on the demand for leveraged/inverse Tesla exposure. Any changes in strategy would be aimed at improving tracking or mitigating risk.

Competitive Edge

TSDD's competitive edge lies in its specific focus on providing 2x inverse exposure to Tesla, which is a popular stock for both bullish and bearish investors. The fundu2019s structure allows traders to easily express a short-term negative view on Tesla without directly shorting the stock. This can be more cost-effective and easier to manage than other methods. The higher leverage offers the potential for amplified returns compared to 1x inverse ETFs, attracting risk-seeking investors who believe Tesla is overvalued.

Volatility

TSDD is highly volatile due to its leveraged nature. It is unsuitable for long-term investment and should only be used by sophisticated investors.

Market Risk

TSDD is subject to the specific risks associated with Tesla, including company-specific news, regulatory changes, and competition in the electric vehicle market. The leveraged nature amplifies these risks.

Ideal Investor Profile

The ideal investor for TSDD is a sophisticated trader with a high-risk tolerance and a short-term negative outlook on Tesla. They should understand the complexities of leveraged and inverse ETFs and the potential for significant losses.

Market Risk

TSDD is best suited for active traders with a short-term investment horizon. It is not appropriate for long-term investors or passive index followers.

The T-Rex 2X Inverse Tesla Daily Target ETF is a leveraged and inverse ETF designed for short-term traders who are bearish on Tesla. Its 2x leverage amplifies both potential gains and losses. The fund is highly volatile and carries significant risk, making it unsuitable for most investors. It should only be considered by sophisticated traders with a deep understanding of leveraged products and a strong conviction in their short-term Tesla outlook.

Data Sources:

• T-Rex ETFs Official Website
• ETF.com
• Bloomberg
• Yahoo Finance

Disclaimers:

This analysis 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 inherently risky and may not be suitable for all investors.