Investing in Netflix Leveraged ETF

Investing in a Netflix leveraged ETF can be a thrilling way to amplify your investment returns, but it's essential to understand the risks involved. Leveraged ETFs aim to deliver a multiple of the daily performance of the underlying index, in this case, the Netflix stock.

The ProShares UltraPro QQQ ETF, for example, seeks to deliver a 3x daily return of the Nasdaq-100 Index, which includes Netflix as one of its components. This means that if the index rises 1%, the ETF will aim to rise 3%.

Investors should note that leveraged ETFs are designed to be used as a short-term trading tool, not as a long-term investment strategy. They can be highly volatile and may not perform as expected during periods of high market stress.

The Netflix Leveraged ETF has two funds: NFXL and NFXS. The NFXL fund has a net asset value (NAV) of $17.52 as of February 20, 2025, while the NFXS fund has a NAV of -$9.44.

The NFXL fund has a market price of $17.46 as of February 20, 2025, which is very close to its NAV. In contrast, the NFXS fund has a market price of -$9.52, which is lower than its NAV.

The expense ratio for both funds is 0.99% gross and 0.97% net. This means that investors will pay 0.97% of their investment as fees to the fund manager. The expense ratio includes management fees, other operating expenses, and acquired fund fees and expenses.

Here's a breakdown of the performance of both funds:

Keep in mind that short-term performance is not a reliable indicator of a fund's future performance, and investors should not make investment decisions based solely on returns.

A leveraged ETF is a type of exchange-traded fund that uses debt to amplify the returns of an underlying asset, such as Netflix.

This amplification is achieved through the use of derivatives, which can result in significant gains, but also come with increased risk.

The use of leverage can be a double-edged sword, as it can both magnify gains and losses, making it essential to understand the potential risks involved.

The Netflix leveraged ETF tracks the daily returns of Netflix, but with a 2x or 3x multiplier, depending on the specific fund.

This means that if Netflix increases in value by 1%, the leveraged ETF will increase by 2% or 3%, respectively.

However, if Netflix decreases in value by 1%, the leveraged ETF will decrease by 2% or 3%, resulting in a loss.

It's essential to note that leveraged ETFs are not suitable for all investors, particularly those with a low-risk tolerance.

Investors should carefully consider their investment goals, risk tolerance, and financial situation before investing in a leveraged ETF.

When assessing the risk of a Netflix leveraged ETF, it's essential to understand the volatility of the investment. The Leverage Shares 3x Netflix ETP Scs has a 1-year volatility of 93.01%.

The data provided by Morningstar, CoinGecko, and Isarvest GmbH shows that the ETF has experienced significant price fluctuations over the past year. In fact, the 1-year maximum loss is a staggering -30.52%.

The Sharpe ratio is a measure of risk-adjusted return, and the Leverage Shares 3x Netflix ETP Scs has a 1-year Sharpe ratio of 1.74. This indicates that the ETF has generated a higher return relative to its risk.

Here's a breakdown of the key risk metrics for the Leverage Shares 3x Netflix ETP Scs:

It's also worth noting that Isarvest GmbH, the provider of the data, does not guarantee the completeness or accuracy of the information.