This is an inverse leveraged ETF designed to track three times the opposite of the S&P 500's daily return. It uses derivatives to reflect short-term declines in the index at an amplified magnitude, and its exposure is reset on a daily basis.

It suits active traders who want to bet on short-term declines in the S&P 500 with leverage or who seek a short-term hedge, and who are willing to accept very high risk.

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

The fund builds its exposure with derivatives to track three times the opposite of the S&P 500's daily return, and it resets that exposure every day. Because of the daily reset structure, a prolonged period of high volatility produces a compounding effect, causing cumulative returns to diverge significantly from a simple three times the opposite of the index.

• Tracks three times the opposite of the S&P 500's daily return
• Inverse leveraged structure that resets every day

Assets under management (AUM) stand at $321.5M, and the total expense ratio is 1.04% per year.

Compared with SPY, which tracks the index directly, the main points of comparison are direction, leverage multiple, and volatility.

Inverse leveraged products amplify index moves in the opposite direction, so they typically post large gains in falling markets and large losses in rising markets. Because equity indexes tend to trend upward over the long term, inverse products can lose significant value if held for long periods.

Fund flows into inverse leveraged products vary widely depending on demand for short-term bearish bets and hedging, and short-term trading and hedging money sometimes flows in when concerns about a market correction grow. It is also worth noting that performance can differ greatly depending on the volatility environment.

Short-term bearish bets and hedging are both its strength and its risk, while the daily reset compounding effect, amplified losses in rising markets, and unsuitability for long-term holding are the main considerations.

For direct exposure to the index itself, alternatives include SPY for the S&P 500, and for a bet against the index without leverage, products such as SPDN, a one-times inverse product, are also worth comparing. If you want two-times inverse exposure, products such as SDS can be considered as well. The three products shown in the table, SQQQ, SH, and SPXU, differ in underlying index and multiple: three-times inverse Nasdaq, and one-times and three-times inverse S&P, respectively. What sets this ETF apart is its inverse leveraged structure, which tracks three times the opposite of the S&P 500's daily return.

Here are the points to review before investing in SPXS. Short-term bearish bets and hedging are appealing, but amplified losses in rising markets, the compounding effect, and unsuitability for long-term holding should be confirmed in advance. It is best to approach the product with a thorough understanding of the inverse leveraged structure.

Amplified losses when the index rises and the compounding effect from the daily reset are the main variables for performance, and because equity indexes tend to trend upward over the long term, inverse products lose significant value when held for long periods. Inverse leveraged products are suited only to short-term trading and hedging, and they carry a high risk of principal loss.

It is a suitable candidate for risk-tolerant traders who want to bet on short-term declines in the S&P 500 with leverage or who seek a short-term hedge. If you want to track the index directly, a product such as SPY is the better fit, and if you want a short-term bearish bet or hedge, it is advisable to choose this product only after fully understanding its structure.