We proudly offer Canada’s first 3X leveraged index ETFs, MegaLong and MegaShort ETFs, traded in Canadian dollars on the TSX. Launched in May 2025, the Mega ETFs offer three times long or short daily exposure to market leading benchmarks.
QQQU/QQQD: Nasdaq 100® Index returns were muted in June, as market leadership rotated away from the main AI stocks that had been driving returns. Semiconductor volatility picked up significantly, as concerns on AI capital expenditures triggered a series of pullbacks. Profit taking was also a key theme, increased by funding trading in the SpaceX IPO from June 12.
SPYU/SPYD: S&P 500® Index returns, while concentrated in top positions, benefitted from broader market participation due to strong economic date and corporate earnings optimism. Easing geopolitical tensions results in sharply lower oil process, supporting consumer sectors of the market.
SOXU/SOXD: U.S. Semiconductors returns benefitted from continued downstream expansion of AI infrastructure investment with more stocks widening industry participation. Continued positive analyst earnings expectations revisions kept momentum in the sector. Volatility has been significant based on valuation concerns and AI capital spending momentum.
CGMU/CGMD: Canadian Gold Miners returns were impacted by profit taking in the sector and softening of the gold spot price, particularly after gold miner stocks significantly outperformed gold over the sector rally.
BNKU: Canadian Banks returns benefitted improving earnings outlooks based on revenue growth from strong capital markets activity and wealth management revenue. Market rotation from AI stocks benefitted financial stocks.
Daily rebalancing has important implications for the performance of a leveraged ETF for periods longer than a day. For leveraged long ETFs, increases in the benchmark push the daily leveraged ETFs net assets higher, which means an increase in exposure by a multiple of the gain in its net assets. Decreases in the benchmark index lead to a decline in net assets, which results in a reduction of exposure in an amount which is a multiple of the decline in the net assets. This means that a daily leveraged long ETF responds to gains by becoming more aggressive and responds to losses by becoming more defensive.
If the benchmark trends upward over several days, the leveraged long ETF’s gains can exceed the cumulative benchmark return multiplied by the ETF's target multiple. If the benchmark trends downward over several days, the leveraged long ETF's loss maybe smaller than the cumulative benchmark return multiplied by the ETF's target multiple. In volatile markets with no clear trend, the impact of daily rebalancing can be harmful to the performance of leveraged ETFs over time. A continued pattern of this sort will typically reduce the longer-term returns of the ETF.
As one of Canada’s fastest growing ETF issuers, we are always on the move. Whether we’re launching new Mega or Savvy ETFs or working with asset managers to bring truly unique ETFs to the Canadian space through the LongPoint Partnership Platform, we always have something new to report.
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Disclaimer
This article is intended for active, high-conviction investors. Always read the full prospectus and disclaimers before investing. Visit www.longpointetfs.com for more information.
LongPoint’s Proprietary ETFs, which include the Mega ETFs, Savvy ETFs and Geared ETFs (the “Proprietary ETFs”), are all alternative mutual funds, and as such, are permitted to invest in asset classes or use investment strategies that are not permitted for other types of mutual funds. The Proprietary ETFs are highly speculative and use a significant amount of leverage which magnifies gains and losses.
The Proprietary ETFs are intended for use in daily or short-term trading strategies by very knowledgeable, sophisticated investors. If you hold a Proprietary ETF for more than one day, your return could vary considerably from that ETF's daily target return. The Proprietary ETFs are not suitable for investors who do not intend to actively monitor and manage their investments.
The Proprietary ETFs, through the use of leverage, may experience amplified losses and should not be expected to deliver their daily return objective over any period of time other than daily. The returns of the Proprietary ETFs over periods longer than one day will likely differ in amount and possibly direction from the performance or inverse performance, as applicable, of their daily target for the same period. This effect is more pronounced for the Proprietary ETFs as the volatility of the daily target and/or the period of time increases. An investor in a Proprietary ETF could lose their entire investment within a single day if the daily target experiences a significant gain or loss, as applicable, that day. This material is for informational purposes only. This material is not intended to be relied upon as research, investment, or tax advice and is not an implied or express recommendation, offer or solicitation to buy or sell any security or to adopt any particular investment or portfolio strategy. Any views and opinions expressed do not take into account the particular investment objectives, needs, restrictions and circumstances of a specific investor and, thus, should not be used as the basis of any specific investment recommendation. Investors should consult a financial and/or tax advisor for financial and/or tax information applicable to their specific situation. All ETFs, including those that seek to track an index are subject to risk, including the possible loss of principal. Diversification does not ensure a profit or protect against a loss in a declining market. While the LongPoint ETFs are designed to be as diversified as the original indices they seek to track and may provide greater diversification than an individual investor may achieve independently, any given ETF may not be a diversified investment. Before investing in shares of the ETFs, investors should consider their ongoing obligations with respect to insider trading, insider reporting, and take-overbids under the Securities Act (Ontario) or other relevant securities legislation (including National Instruments) and as explained in National Policies. Securities regulators may take the view that these provisions extend to the purchase and sale of Shares of the ETFs as they invest in securities of a single issuer, including on a look-through basis.
All data contained here in is provided “as is” and LongPoint makes no representation or warranty of any kind, either express or implied, with respect to such data, the timeliness there of, the results to be obtained by the use thereof or any other matter. LongPoint expressly disclaims any and all implied warranties, including without limitation, warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose.
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