It is a leveraged ETF designed to track twice the daily return of the Dow Jones index. It uses derivatives to reflect the index's short-term moves in magnified form, and its exposure is reset on a daily basis.

It suits active traders who want to place leveraged bets on the short-term direction of the Dow Jones index and who are willing to accept a high level of risk.

It is a passive (index-tracking) ETF managed by ProShares.

The fund builds its exposure with derivatives to track twice the daily return of the Dow Jones index, and it resets its leveraged exposure every day. Because of this daily reset structure, a prolonged period of high volatility produces a compounding effect, causing cumulative returns to differ significantly from a simple doubling of the index's return.

• Tracks the daily leveraged return of the Dow Jones index
• Leverage structure that is reset every day

Assets under management (AUM) stand at $518.6M, and the expense ratio is 0.95% per year.

The main points of comparison with DIA, which tracks the Dow Jones without leverage, are the leverage multiple and volatility.

Leveraged index products magnify the index's moves, so they typically deliver large gains in rising markets and large losses in falling markets. In choppy, volatile sideways markets, the compounding effect of the daily reset can cause long-term performance to diverge sharply from the index.

Fund flows into leveraged products vary widely with demand for short-term directional bets, and short-term trading money sometimes flows in when conviction about the market's direction grows. It is also worth noting that performance can differ greatly depending on the volatility environment.

The potential for short-term leveraged gains is both its strength and its risk, and the compounding effect of the daily reset and its unsuitability for long-term holding are key considerations.

For exposure to the Dow Jones without leverage, direct substitutes include DIA, and for higher leverage, products such as UDOW, which tracks three times the Dow Jones, are also worth comparing. To bet on an index decline, inverse products such as SDOW and DOG can also be considered. The three products in the table, QLD, SSO and TQQQ, track the Nasdaq and the S&P 500 with leverage, so their underlying indexes are different. What differentiates this ETF is its leveraged structure that tracks the Dow Jones index at twice the daily return.

Here are the points to review before investing in DDM. Short-term leveraged gains are attractive, but magnified losses, the compounding effect and unsuitability for long-term holding need to be confirmed in advance. It is best to approach the fund only after fully understanding the leverage structure.

Magnified losses when the index falls and the compounding effect of the daily reset are the main variables for performance, and in volatile markets long-term returns diverge sharply from the index. Leveraged products are not suitable for long-term holding and carry a high risk of principal loss.

It is a suitable candidate for risk-tolerant traders who want to place leveraged bets on the short-term direction of the Dow Jones index. For investing without leverage, a product such as DIA is the better fit, and for short-term leveraged bets, it is advisable to choose this product only after fully understanding its structure.