Investing in Inverse Tesla ETFs Explained

Inverse Tesla ETFs can be a useful tool for investors who want to profit from a decline in Tesla's stock price.

These ETFs typically use a short-selling strategy, where a portion of the fund's assets are invested in shorting Tesla's stock.

However, it's essential to understand that inverse ETFs can be complex and may not always behave as expected.

Inverse Tesla ETFs often come with higher fees and may be more volatile than traditional ETFs.

The T-REX 2X INVERSE TESLA DAILY TARGET ETF has a legal name that's quite a mouthful. Its fund family name is listed as N/A.

The fund was launched on October 19, 2023, which is a relatively recent inception date. Shares outstanding and share class information are also listed as N/A.

Here are the fund's details in a concise table:

The Direxion Daily TSLA Bear 1X Shares ETF is a new fund that would bet against Tesla on a daily basis. It would provide exposure to investors who believe the price of Tesla will fall or those looking for a hedge against a long TSLA position.

Direxion's filing follows a filing for the InnovationHedged Tesla ETF that's seeking to buy and sell call options in Tesla. This fund would invest 20% in calls on Tesla shares and put the rest of the capital into U.S. Treasury bills.

The ETF would trade with the ticker TSLH. The filing was shared by Eric Balchunas, the Senior ETF Analyst at Bloomberg.

Direxion already offers several 3x leveraged ETFs allowing investors to bet on the bullish or bearish side for indexes like the Dow Jones Industrial Average and S&P 500.

The T-REX 2X INVERSE TESLA DAILY TARGET ETF has a legal name that's straightforward and to the point.

This fund is part of an unspecified fund family, which may or may not be a significant factor in its investment strategy.

The fund was launched on October 19, 2023, marking the beginning of its investment journey.

Unfortunately, the number of shares outstanding is not publicly disclosed, making it difficult to gauge the fund's popularity.

For investors who prefer to track their investments in a specific currency, the T-REX 2X INVERSE TESLA DAILY TARGET ETF is denominated in USD.

As a US-based fund, it's domiciled in the United States, which may influence its regulatory environment and investment opportunities.

Here's a summary of the fund's basic details:

The performance of the TSLZ - Inverse Tesla ETF is quite something to look at. The year-to-date return is a staggering -3.4%.

Looking at the one-year return, it's clear that the ETF has had a tough time, with a -91.5% return. That's a significant drop in a relatively short period.

The longer-term returns are not available for the three, five, and ten-year periods. This could be due to the ETF's relatively new status or other factors.

Let's take a closer look at the available data. Here are the returns for the specified periods:

As you can see, the one-year return is significantly lower than the year-to-date return, which could indicate a volatile period for the ETF.

The Inverse Tesla ETF is available on several popular trading platforms, including the ARK Invest website, Fidelity, and Robinhood.

You can trade the Inverse Tesla ETF during regular market hours, typically between 9:30 AM and 4:00 PM ET, Monday through Friday.

The ETF is designed to provide a daily return that is the inverse of the daily return of Tesla's stock, making it a useful tool for investors who want to profit from a decline in Tesla's stock price.

The Inverse Tesla ETF is a relatively new product, launched in 2021, and is listed on the Cboe BZX Exchange.

Investors can buy and sell the Inverse Tesla ETF with a minimum investment of $1,000, and the ETF is subject to a management fee of 0.75% per year.

Investing in an Inverse Tesla ETF can come with some costs, and it's essential to understand what you're paying for.

The ongoing charge, also known as the OCF or TER, is 2.78%. This is a significant portion of your investment, so make sure you're comfortable with this level of expense.

You won't have to pay a management fee, as it's listed as n/a.

The indicative spread is 0.66%, which is another cost you'll incur when investing in this ETF.

Here's a breakdown of the costs you can expect:

It's crucial to note that in some cases, additional costs may apply, so be sure to read the Key Investor Information Document, Factsheet, and Prospectus before investing.