ProShares UltraPro Russell2000 (URTY)

Overview

The ProShares UltraPro Russell2000 (URTY) is a leveraged ETF that seeks to deliver three times (3x) the daily performance of the Russell 2000 Index. It targets investors seeking magnified daily exposure to small-cap U.S. equities. It uses derivatives to achieve its leveraged exposure.

Reputation and Reliability

ProShares is a well-known issuer of leveraged and inverse ETFs, with a proven track record in this specialized area.

Management Expertise

ProShares has extensive experience in managing leveraged and inverse ETFs, requiring specialized knowledge of derivative instruments and market volatility.

Goal

To seek daily investment results, before fees and expenses, that correspond to three times (3x) the daily performance of the Russell 2000 Index.

Investment Approach and Strategy

Strategy: This ETF employs a leveraged strategy, aiming to amplify the daily returns of the Russell 2000 Index through the use of derivatives like swaps and futures contracts.

Composition The ETF holds a combination of financial instruments, including swap agreements, futures contracts, and potentially some equity securities of companies within the Russell 2000 Index to replicate the index's performance and achieve its 3x leverage objective.

Market Share: Market share data is difficult to ascertain exactly for leveraged ETFs due to their unique function, but generally, the fundu2019s trading volume indicates its influence in the leveraged small-cap space.

Total Net Assets (AUM): 858676327

Key Competitors

• Direxion Daily Small Cap Bull 3X Shares (TNA)
• MicroSectors U.S. Small Cap 3X Leveraged ETN (TNAZ)

Competitive Landscape

The competitive landscape for leveraged small-cap ETFs is relatively concentrated with a few key players. URTY's advantage lies in ProShares' established brand and experience. Disadvantages include the inherent risks of leveraged ETFs, including volatility and potential for significant losses, as well as potential tracking error due to daily rebalancing.

Historical Performance: Historical performance is highly volatile due to the 3x leverage. Past performance is not indicative of future results. Numerical data is available on financial websites like Yahoo Finance.

Benchmark Comparison: The ETF aims to deliver 3x the *daily* performance of the Russell 2000, making direct long-term benchmark comparisons difficult due to compounding effects and potential decay.

Expense Ratio: 0.95

Average Trading Volume

URTY exhibits a relatively high average trading volume, facilitating easy entry and exit for investors.

Bid-Ask Spread

The bid-ask spread can fluctuate, especially during periods of high volatility, reflecting the cost of trading the ETF.

Market Environment Factors

Economic growth, interest rate changes, small-cap sector sentiment, and overall market volatility significantly impact URTY's performance.

Growth Trajectory

URTY's growth trajectory depends on investor appetite for leveraged exposure to small-cap stocks and broader market trends. Significant changes to holdings are unlikely as the fund tracks the Russell 2000 index.

Competitive Edge

URTY's main advantage is its 3x leveraged exposure to the Russell 2000, offering investors amplified gains (and losses) on a daily basis. ProShares' experience in managing leveraged ETFs provides some degree of investor confidence. However, leveraged ETFs are complex and should only be considered by sophisticated investors. The daily rebalancing mechanism, while intended to maintain the 3x leverage, can lead to performance erosion over longer time periods, especially in volatile markets.

Volatility

URTY exhibits extremely high volatility due to its 3x leverage, making it significantly riskier than non-leveraged ETFs.

Market Risk

The primary market risk is the potential for amplified losses due to adverse movements in the Russell 2000 Index. The daily rebalancing can also lead to tracking error and erosion of value over time.

Ideal Investor Profile

The ideal investor for URTY is a sophisticated, risk-tolerant trader with a short-term investment horizon and a strong understanding of leveraged ETFs and market dynamics.

Market Risk

URTY is suitable for active traders seeking short-term tactical exposure to the Russell 2000 Index, not for long-term investors or passive index followers.

ProShares UltraPro Russell2000 (URTY) is a leveraged ETF designed for short-term, active trading. It aims to provide three times the *daily* return of the Russell 2000 index, making it highly volatile and risky. It is suitable for sophisticated investors who understand the complexities of leveraged ETFs. Due to compounding effects and daily rebalancing, it is not intended for long-term holding. Its performance is highly dependent on the Russell 2000's movement and market sentiment.

Data Sources:

• ProShares website
• Yahoo Finance
• ETF.com
• SEC filings

Disclaimers:

This analysis is for informational purposes only and does not constitute financial advice. Investing in leveraged ETFs involves significant risks, including the potential loss of principal. Past performance is not indicative of future results.