How Tactical Traders can Profit From Volatility

I think a lot of people, when they think of ETFs, think of many stocks in one or a basket of stocks. The single stock ETF is a relatively new concept.

These came live back in 2022, and this past year, in particular, you've seen incredible growth. One of our largest funds as a firm is our 2x Tesla fund, TSL. If you think about it, I've mentioned Tesla, Palantir, and Meta. These are all names that often see volatile trading periods.

For tactical traders with conviction, buying a 2x fund or going short with a negative 1x fund is a great way to profit on quick, short, directional trades. These are not buy-and-hold investment vehicles. The leverage resets daily. We like to say the trend is your friend. If you're long a 2x fund and the market is one directional bull market, great, you can make a great profit.

If markets get choppy, you see real volatility, or the market runs against you, that compounding works against you as well. We really do like to reiterate that these are tools meant for tactical traders. For traders looking to learn more, go to our website, direction.com, and go to our Direction University to unpack some of the resources there to better understand how these fit your broader portfolio.