GraniteShares launches S&L ETPs on top-performing US stocks
ETF provider GraniteShares has launched nine three-times long and nine three-times short (inverse) ETPs on some of the top performing US technology stocks, on London Stock Exchange.
The daily ETPs provide long and short exposure to Alphabet, Amazon, Apple, Microsoft, Netflix, Facebook, NVIDIA, Tesla and Uber. GraniteShares says no other ETPs provide this level of short and leveraged exposure to these popular US tech stocks.
Traders and sophisticated investors will be able to access these new ETPs for a fraction of the price that they would have to pay to buy the individual stocks. The ETPs are listed at a price of USD5.00, while most of the stocks being tracked by the ETPs trade at prices in excess of USD200, Amazon, for example, closed on 30 June at USD2,758.82, Apple at USD364.80, Netflix at USD455.04, Tesla at USD1,079.81. Investors will also have the opportunity to trade ETPs on these popular US stocks in UK trading hours, as opposed to when the US markets open.
GraniteShares chose to launch new short and leveraged ETPs on major US tech sector stocks because they are at the centre of a megatrend, delivering long-term growth through a technological revolution sweeping through societies and economies worldwide.
Analysis by GraniteShares reveals that of the 11 sectors within the S&P 500, the technology sector has consistently been a top performer. For example, over three months, six months, one year and five years to 30 June 2020, it has delivered growth of 27.58 per cent, 14.35 per cent, 33.89 per cent and 152.39 per cent respectively. The corresponding figures for the S&P 500 are 18.03 per cent, -3.76 per cent, 5.39 per cent, and 50.27 per cent.
Over the past six months, the tech element of the S&P 500 was one of only three sectors that delivered growth (Consumer Discretionary and Communication Services being the others), and over a year it was one of five to providing positive returns.
In terms of the individual stocks the new GraniteShares ETPs are tracking, analysis reveals that over the past six months, one year and five years, they have consistently featured among the top performers in the S&P 500.
Will Rhind, Founder and CEO at GraniteShares, says: “We listed 3x short and leveraged ETPs on eleven FTSE 100 stocks in November last year. These are trading with tight spreads and starting to see significant traction.
“With increased market volatility and a stellar performance from leading companies within the US tech sector, many of which are familiar household names and widely followed by UK investors, now is a great time to launch our new products.
“Growth in stock markets is often concentrated in a small group of companies and our new products focus on some of the stocks that have been the key drivers of S&P 500 returns. If sophisticated investors believe that these stocks still have a long way to go in terms of growth and performance, they can use our products to multiply returns. However, if at any stage they think they are in a bubble and they expect their share prices to fall, we enable them to position to benefit from falling prices as well.
“Figures from ETFGI show that the global short and leveraged ETP market was worth around USD77 billion at the end of last year, but most of this is in the US. Indeed, of the 20 largest short and leveraged ETPs in the world, 12 are listed in the US, six in Asia and there are just two in Europe (one in France and one in Germany). As with unleveraged ETFs, we believe that there is scope for significant growth in the short and leveraged ETP market in the UK and Continental Europe. We aim to play a key role in this both in terms of educating investors and giving them the toolkit to help them achieve their investment goals.”
Lida Eslami, Head of Business Development, ETP and IOB, London Stock Exchange, says: “We congratulate GraniteShares on the listing of their new short and leveraged ETPs on London Stock Exchange. London is a leading ETP listing and trading venue, and our markets continue to offer investors a wide range of innovative products across assets classes and geographies, key to providing choice and diversification suited to their strategies.”
Timo Pfeiffer, Chief Markets Officer at Solactive, says: "After our first and successful release with GraniteShares last year, we are delighted to see a continuation of their ETP series with us, this time expanding the underlyings to highly popular US stocks. The ETPs offer a leveraged play on high conviction ideas, giving sophisticated investors yet another slick tool in their toolbox to access their favourite names across the pond."