Leverage Shares has rolled out several new ETPs on London Stock Exchange providing access to popular US technology stocks and tactical exposure to US Treasuries.
Oktay Kavrak, Director of Product Strategy at Leverage Shares.
The Leverage Shares FAANG+ ETP provides long, unleveraged exposure to an equally weighted portfolio consisting of Meta Platforms, Apple, Amazon, Netflix, Microsoft, Alphabet, Tesla, Advanced Micro Devices, Nvidia, and Broadcom.
According to Leverage Shares, the ETP is the first pure-play product for European investors that provides physical, concentrated exposure to a group of leading technology stocks while eliminating the ‘fillers’ that are common with UCITS ETFs.
It comes with an expense ratio of 0.35%.
The remaining six ETPs provide quintuple long (+500%) or short (-500%) exposure to US Treasury Inflation-Protected Securities (TIPS), US Treasuries with remaining maturities between seven and ten years, and US Treasuries with remaining maturities greater than 20 years.
Historically, inverse and leveraged ETPs have typically used derivatives, such as swaps, to achieve their geared exposure, introducing credit risk to investors.
Leverage Shares ETPs, however, do away with credit risk. Each ETP invests in liquid, third-party ETFs that provide the desired exposure, using margin loans to leverage the ETP’s position as required. Residual cash, such as dividends from the underlying ETFs, is also reinvested.
According to Leverage Shares, the firm’s ability to access margin borrowing at institutional rates allows it to offer its products to investors at a competitive rate. Each ETP comes with a management fee of 0.75%.
Inverse and leveraged ETPs can be considered inappropriate for retail investors who perhaps might not fully understand the risks involved. For sophisticated traders, however, they offer an efficient means to hedge existing positions or take out new tactical exposures.
Oktay Kavrak, Director of Product Strategy at Leverage Shares, said, “We are proud to gear up sophisticated investors with the tools necessary to navigate the current volatility in interest rates and inflation expectations. By adding short and leveraged fixed income ETPs and our first pure-play basket to our product line-up in London, we’ve solidified our place as the go-to provider of alternative investment ETPs for investors across the UK and Europe.”
The new listings are outlined below:
Leverage Shares 5x Long TIPS Inflation Protected US Bond ETP
Leverage Shares -5x Short TIPS Inflation Protected US Bond ETP
Leverage Shares 5x Long 7-10 Year Treasury Bond ETP
Leverage Shares -5x Short 7-10 Year Treasury Bond ETP
Leverage Shares 5x Long 20+ Year Treasury Bond ETP
Leverage Shares -5x Short 20+ Year Treasury Bond ETP