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All rights reserved. All registered trademarks are property of their respective owners .  \nContents  \nExecutive Summary 3  \nA Primer on Leveraged Funds 4  \nA New Way to Trade Across Asset Classes 6  \nAre Leveraged Funds Right for You? 9  \nUsing Leveraged Funds 10  \nLeveraged Fund Activity During Major Stock Selloffs 11  \nThe 2020 Covid Bear Market 11  \nThe 2022 Inflation Crisis 12  \nThe 2025 Liberation Day Drop 14  \nFinding Opportunities 16  \nWhat Happens Next? 17  \nResearch Team 19  \n2 Leveraged Funds and The Active Trading Boom  \nExecutive Summary  \nFor decades, investors have been searching for an edge. A way to double down or amplify their beliefs about certain stocks or sectors without using complex instruments or signing lengthy margin agreements.  \nLately, they’ve found a home in leveraged exchange-traded funds and notes (ETFsand ETNs), which have caught fire since the beginning of COVID and the latest active trading renaissance. Volume in these funds  \n– which allow traders to speculate in a wide range of assets – has grown faster than options or stock volumes between 2020 and 2025.  \nSince then, every market selloff has felt like a defining moment for leveraged funds. April 2025 – when the White House shocked the world with extreme tariff policy – set a trading  \nrecord for leveraged funds in both volume and turnover.  \nWall Street has leaned into this obsession, too. Innovative funds burst onto the scene faster than ever in 2025, with the list of active leveraged funds expanding at the fastest pace since 2007. Single-stock leveraged funds that allow you to speculate on popular names like Nvidia, Microsoft, and Amazon have flourished in their three years of existence, now commanding half of all leveraged equity fund volume.  \nIn this report, we will dig into how the leveraged fund space has grown so quickly and how major market events have contributed to this evolution.  \nSpecifically, we’ll examine:  \n• What drove this tremendous growth in leveraged funds.  \n• How sophisticated active retail traders have used these funds to express their bullish or bearish views. We’ll focus specifically on how they’ve behaved during recent market events: the initial COVID selloff, the 2022 bear market, and 2025’s 19% Liberation Day drop.  \n• What changing investor preferences could bode for the future of leveraged funds.  \n• If leveraged funds could complement your own approach to trading.  \n3 Leveraged Funds and The Active Trading Boom  \nA Primer on Leveraged Funds  \nLeveraged funds came on the scene in June 2006, allowing individual investors the ability to speculate against – or double/triple down – on the fates of popular stock funds, indexes, and sectors.  \nWhile the initial adoption was strong, the leveraged fund space was about to face its first test. In late 2007, the S&P 500 fell into a treacherous 57% slide, brought on by economic fears and a credit meltdown now known as the Global Financial Crisis. America’s risk appetite was neutered by such a quick and nasty turn of fortune, and the retail investing population developed a distrust of Wall Street. Leveraged  \nfunds enjoyed a few years of exponential AUM growth, then floundered in the early 2010s.  \nThen came the wild west of the 2020s. COVID forced us all to stay in our homes and be glued to our phones. Since then, stock trading volume has exploded by 60%, options volume has more than doubled, and everyday investors have adopted a whole new level of sophistication.  \nAnd in turn, leveraged fund activity has soared. Leveraged volumes have grown at a 29% annual pace since 2020 – faster than options and stock market volumes over that same period.  \nLeveraged Fund Volume Has Soared Since COVID  \nAverage leveraged ETF/ETN volume per day vs. options and stock volume  \n2020 through 2025. Volume figures are in millions.  \nLeveraged / Inverse Fund Volu","cbCair4vO7sU4fw3","https://ap.wps.com/l/cbCair4vO7sU4fw3","pdf",1333104,20,"English","# Executive Summary\n## A Primer on Leveraged Funds\n## A New Way to Trade Across Asset Classes\n## Are Leveraged Funds Right for You?\n## Using Leveraged Funds\n## Leveraged Fund Activity During Major Stock Selloffs\n## Finding Opportunities\n## What Happens Next?\n## Research Team","[{\"question\":\"What factors drove the growth of leveraged funds since COVID?\",\"answer\":\"The report attributes growth to a surge in investor sophistication and a dramatic rise in trading activity, with leveraged volumes increasing faster than options and stock volumes after 2020.\"},{\"question\":\"How do leveraged ETFs and ETNs work at a practical level?\",\"answer\":\"They combine pooled-access vehicles (ETFs/ETNs) with leverage through derivatives, enabling intraday speculation in a familiar wrapper while still exposing traders to related margin and derivative dynamics inside the products.\"},{\"question\":\"What market events does the report use to study leveraged fund usage?\",\"answer\":\"It examines investor behavior during the initial COVID selloff, the 2022 bear market, and the 2025 19% Liberation Day drop to show how leveraged funds reacted and how traders expressed views.\"}]","Leveraged Funds and The Active Trading Boom - White paper | PDF",1791839786]