Coinbase Leveraged ETF: Understanding 3x Leverage and Investing

So you're considering investing in a Coinbase leveraged ETF, but you're not sure what 3x leverage really means. 3x leverage means that for every dollar you invest, the ETF will try to return three dollars in profits.

In the world of finance, leverage is a powerful tool that can amplify your gains, but it also increases the risk of losses. This is because leverage involves borrowing money to buy more assets than you could afford otherwise.

For example, if you invest $100 in a 3x leveraged ETF, the ETF will try to return $300 in profits if the market moves in the right direction. However, if the market moves against you, you could lose $300 for every $100 you invested.

3x leverage is a way to multiply the gains of an investment, but it also multiplies the losses.

It's a daily calculation, meaning it's reset every 24 hours, so if Coinbase Global Inc rises by 1% over a day, the ETP will rise by 3%, excluding fees and other adjustments.

This means if you invest in the ETP and Coinbase Global Inc has a good day, your investment will increase by 3 times the daily gain.

However, if Coinbase Global Inc has a bad day and falls by 1%, the ETP will fall by 3%, excluding fees and other adjustments, which can result in significant losses.

The 3x leverage is available in three currencies: EUR, GBP, and USD.

The Coinbase leveraged ETFs are designed to track the daily performance of Coinbase Global, Inc. (COIN), but with a twist. They aim to provide a multiple of the daily returns, ranging from 1.5 to 3 times.

Here are some key facts to consider:

Here's a summary of the daily investment objectives for some of the Coinbase leveraged ETFs:

Keep in mind that these funds are designed to track the daily returns of COIN, and should not be expected to provide a multiple of the cumulative return for periods greater than a day.

The Coinbase leveraged ETF aims to provide daily investment results that are 2 times the daily percentage change of the common stock of Coinbase Global Inc.

This means that if COIN goes up 5% in a day, the fund should go up 10% before fees and expenses.

The fund is not designed to provide 2 times the cumulative return of COIN for periods longer than a day, so investors should be aware of this limitation.

The investment objective is straightforward. The ETP Securities aim to provide 3 times the value of the daily performance of Coinbase Global, Inc. (COIN) stock, minus fees and expenses.

Investors should understand that this means tracking the iSTOXX Leveraged 3x COIN Index, which offers exposure to 3 times the daily performance of COIN.

The Fund's objective is to mirror the daily performance of COIN, but with a multiplier of 2, before accounting for fees and expenses.

Investors should note that this fund is designed for short-term performance, with no guarantee of 2 times the cumulative return of COIN for periods longer than a day.

The daily performance of the fund will be heavily influenced by the daily changes in the value of COIN stock.

Commission rates for trading can be as low as 0.1% of the total trade value, making it a cost-effective option for frequent traders.

Brokerage fees for buying and selling stocks can range from $5 to $20 per trade, depending on the brokerage firm and the type of account.

Some brokerages offer a flat fee of $5 per trade, making it a more affordable option for low-frequency traders.

In addition to commission rates, traders may also be charged for trading on margin, which can range from 2.5% to 5% of the borrowed amount.

Day trading accounts often have higher fees due to the increased number of trades made within a short period.