Leveraged Equity Rallies as Semiconductor Volatility Drives Mixed Flows

Weekly Channel Summary

The Leverage & Inverse channel ended the week with $153.26B in total AUM spread across 775 ETFs from 26 issuers. Net flows were negative for the week at -$3,505M, though the channel remains firmly positive for both the YTD period ($14,776M) and the trailing 1-Year window ($16,236M). The weekly outflow contrasts with the broader longer-term trend of steady investor engagement with leveraged and inverse products across asset classes.

This Week’s Performance Leaders and Laggards

Leverage/Inverse – Equity led all categories on the week with a WTD gain of 9.12%, despite remaining negative over the 1-Month (-22.17%) and 3-Month (-24.08%) windows, while still holding a positive YTD return of 11.90%. Single Stock products also posted strong weekly gains at 6.09% WTD, with a 12.23% YTD return despite steep 6-Month drawdowns of -40.99%. On the downside, Crypto products were the weakest performers, falling -16.52% WTD and now down -56.37% YTD, reflecting continued volatility in digital asset-linked leveraged exposure. Among individual funds, ETHD topped the list with a 28.84% weekly gain, followed closely by SOXL at 26.87%, while SOXS was the week’s worst performer at -28.43%, underscoring the sharp divergence within semiconductor-linked leveraged products.

Top & Bottom 5 ETFs by Weekly Performance

The top-performing funds this week were concentrated in equity and single-stock leverage, with ETHD gaining 28.84% and SOXL advancing 26.87%, alongside TAWN up 26.42%. Inverse crypto exposure also featured prominently among gainers, with SBIT rising 20.37% and BTCZ up 20.11%, reflecting a weak week for underlying crypto assets. On the opposite end, SOXS declined -28.43% and TPEI fell -27.80%, both inverse products suffering from strength in their respective underlying sectors. The dispersion between top and bottom performers highlights the amplified volatility inherent to 2x and 3x leveraged and inverse structures this week.

Analyzing the Weekly Flows

The channel recorded a net outflow of -$3,505M for the week, driven almost entirely by the Leverage/Inverse – Equity category, which shed -$4,034M despite being the top category over the trailing 30-day and 90-day windows. Single Stock products were the standout for inflows, gathering $677M for the week and extending a robust YTD total of $11,641M. Commodity and Fixed Income categories posted modest outflows of -$80M and -$58M respectively, while Crypto saw a slight -$10M weekly redemption despite a strong YTD inflow figure of $1,166M. The equity category’s weekly outflow stands in sharp contrast to its $9,838M inflow over the past 90 days, suggesting a short-term pullback rather than a structural shift in demand.

Category Flows Summary

Top & Bottom 5 ETFs by 5-Day Flow

GraniteShares’ NVDL led all funds in weekly inflows with $758M, followed by ProShares’ TQQQ at $379M, both reflecting continued demand for leveraged mega-cap tech exposure. On the outflow side, Direxion’s SOXL saw the largest weekly redemption at -$4,172M, far outpacing the next largest outflow from ProShares’ SSO at -$175M. The scale of the SOXL redemption, despite the fund’s strong 26.87% weekly price gain, points to profit-taking following the semiconductor rally. Overall fund-level flows this week show a clear bifurcation between tech-focused long leverage products attracting fresh capital and broader semiconductor leverage experiencing outsized redemptions.

Note: the following fund(s) were excluded from the flow totals above because the weekly flow exceeds 75% of the fund’s AUM and may be the result of a custom rebalance: SOXS (-$2,161M), SMHU ($97M).

Issuer League Table Update

ProShares remains the largest issuer in the channel with $76.15B in AUM and a 49.68% market share, followed by Direxion at $53.01B and 34.59% share, together commanding roughly 84% of total channel assets. GraniteShares led all issuers in weekly inflows with $799M, driven largely by strength in its NVDA-linked leveraged products, while ProShares added a further $93M. Direxion was the clear outlier on the outflow side, shedding -$4,297M for the week, consistent with the heavy redemptions seen in its semiconductor-leveraged equity fund. The divergence between GraniteShares’ inflows and Direxion’s outflows this week illustrates a rotation in investor preference toward single-stock leverage over broader semiconductor-sector exposure.

Top 5 Issuers by AUM

Top & Bottom 3 Issuers by 5-Day Flow