5 Best Leveraged ETFs of Last Week

Wall Street was overall upbeat last week. Though concerns about the spread of the Delta variant of coronavirus worried investors, low rates boosted the demand for stock investments. The S&P 500, the Dow Jones and the Nasdaq Composite added about 1.96%, 1.08% and 2.84%, respectively, last week.

Wall Street had a shaky start to the week due to a spike in U.S. COVID cases, which is a potential threat to economic reopening. The Dow Jones in fact had logged a 725-point loss on Jul 19, marking the worst day since October. The benchmark U.S. treasury yield fell to as low as 1.19% on Jul 19.

However, investors shrugged off fears and again entered the market rally with full enthusiasm. The Dow Jones then enjoyed its strongest two-day (on Jul 20 and Jul 21) rally since March. The S&P 500 and the Nasdaq too were in fine fettle. Upbeat earnings also helped the markets to bounce back.

The small-cap benchmark Russell 2000 Index saw the biggest rebound with a 1.7% gain. The 10-year yield too jumped back to 1.30% on Jul 23. Many of the stocks that were hit the hardest on Jul 19, on concerns about the COVID-19 Delta variant, rebounded in the days that followed. Airlines and cruise companies spearheaded the revival (read: Risk-On Sentiments Back: 5 ETFs Up At Least 7%).

Against this backdrop, below we highlight a few leveraged ETFs that were extremely gainful last week..

ETFs in Focus

Ultra Bloomberg Natural Gas ETF BOIL – Up 20.3%

Warmer-than-normal weather is expected to remain for most of the United States over the next 6-10 and 8-14 days and this will likely boost the cooling demand. As a result, the demand for natural gas has brightened up last week.

The underlying Bloomberg Natural Gas Subindex is intended to reflect the natural gas segment of the commodities market. The index consists of futures contracts on natural gas. The expense ratio of the fund is 0.95%.

Pharmaceutical & Medical Bull 3X Direxion PILL – Up 18.5%

The broader medical sector is in the spotlight now on higher demand for coronavirus vaccine as well as the treatment as the Delta variant of the COVID-19 scare rises. Apart from this, upbeat earnings and decent valuation should give the sector a further drive (read: Time for Pharma and Healthcare ETFs?).

The underlying S&P Pharmaceuticals Select Industry Index consists of common shares of companies that are principally engaged in research, development, manufacture, sale or distribution of pharmaceuticals and drugs of all types. The expense ratio of the fund is 1.00%.

Homebuilders & Suppliers Bull 3X Direxion NAIL – Up 18.1%

As interest rates slipped all over again, U.S. mortgage rates too slid to the lowest in more than five months. As a result, the rate-sensitive sector has got a boost last week. The underlying Dow Jones U.S. Select Home Construction Index measures U.S companies in the home construction sector that provide a wide range of products and services related to homebuilding. The fund’s expense ratio is 1.00%.

Dow Jones Internet Bull 3X Direxion WEBL – Up 15.2%

Tech stocks, mainly the Internet ones, have been in fine fettle. Earnings growth potential for the same has also been upbeat for the space. Moreover, these stocks fall under the stay-at-home category which is likely to get a boost from the surge in the Delta variant cases. The underlying Dow Jones Internet Composite Index of the fund includes only companies whose primary focus is Internet-related. The fund’s expense ratio is 1.00% (read: 5 Best-Leveraged ETFs of the Second Quarter).

Semiconductor Bull 3X Direxion SOXL – Up 13.0%

Semiconductors have shown strong resilience amid the coronavirus pandemic on the stay-at-home trend, which has bolstered the demand for gaming chips and data center business. Moreover, Apple (NASDAQ:AAPL) is reportedly asking suppliers to boost the production of its next-generation iPhones by 20%, according to a Bloomberg News, as quoted on CNBC. The very news further boosted the demand for semiconductors (read: Apple ETFs at Record High: Further Potential on iPhone Optimism).

The underlying PHLX Semiconductor Sector Index measures the performance of the semiconductor sub-sector of the U.S. equity market. The fund’s expense ratio is 0.99%.

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