Who Started Leveraged Netflix ETF?

In partnership with Tuttle Capital Management, Rex Shares has entered the next phase of leveraged single-stock exchange-traded funds (ETFs) with the introduction of the T-Rex 2X Long NFLX Daily Target ETF (NFLU). This ETF is known as Netflix ETF.

This fund began trading on Friday and is designed to provide investors with 200% exposure to Netflix’s (NFLX) daily stock price movements—making it the first ETF to offer such a leveraged position on the streaming giant.

As the CEO of Tuttle Capital Management, Matthew Tuttle, explained, the market for leveraged single-stock ETFs is expanding beyond its initial offerings of top-rated stocks such as Tesla, Nvidia, and MicroStrategy.

According to Tuttle, the early movers in this space have capitalized on high-profile stocks, but the next wave of ETFs will focus on “second-tier” companies, such as Netflix.

“The low-hanging fruit with names like Tesla and Nvidia is already gone, but as the space broadens, we want to think of the next tier of names,” said Tuttle.

He added, “While the second-tier ETFs may not hit the $4 billion mark, there’s potential for them to reach around $100 million in assets.”

NFLU marks the twelfth collaboration between Rex Shares and Tuttle Capital Management. Other leveraged single-stock ETFs in this series include funds tied to major tech companies like Apple (AAPX), Alphabet (GOOX), and Microsoft (MSFX).

While many of the T-Rex series ETFs offer both leveraged long and inverse options, Netflix currently only has the long option.

However, an inverse Netflix ETF has been filed with the Securities and Exchange Commission (SEC), meaning investors might soon have the opportunity to bet against Netflix’s daily price movements.

Tuttle emphasized the growing demand for leveraged long ETFs in the current market environment. “You don’t fight the Fed,” Tuttle remarked.

“With rates moving lower, we’re seeing strong demand for long-side ETFs, especially those tied to less volatile stocks.”

He indicated that despite concerns over economic slowdowns, the Federal Reserve’s rate cuts suggest continued bullish sentiment, reducing the likelihood of a bear market in the near term.

Tuttle Capital Management, which independently manages eight ETFs, sees plenty of growth opportunities in the single-stock ETF sector.

In June, Rex Shares and Tuttle Capital filed with the SEC to launch 44 more single-stock ETFs, with half offering leveraged long exposure and the other half offering inverse exposure to the respective stocks.

The evolution of leveraged ETFs has been swift. The first single-stock ETFs were only introduced in December 2022, and since then, the space has grown rapidly, with both long and inverse strategies gaining traction among investors looking for precise, stock-specific plays.

Why Netflix and What’s Next?

Netflix, a household name in the entertainment industry, has a unique position in the market. Its stock has been volatile, influenced by factors such as subscription growth, competition in streaming, and content development costs.

These market dynamics make Netflix an appealing candidate for a leveraged ETF, as traders seek to capitalize on both short-term spikes and dips.

As the ETF market continues to evolve, we may see more sector-specific or stock-specific leveraged funds, expanding opportunities for active investors.

The upcoming inverse Netflix ETF, once approved, will allow investors to hedge their positions or take a bearish stance on Netflix, particularly useful in times of market uncertainty.

With interest rates dropping and the overall market leaning toward growth stocks, Tuttle Capital and Rex Shares are banking on the continued success of their leveraged ETF offerings.

As Tuttle stated, “With the Fed lowering rates, this doesn’t get me thinking about a bear market,” which points to the company’s confidence in the long-term growth potential of these funds.

In conclusion, Rex Shares and Tuttle Capital are pioneering the next wave of leveraged single-stock ETFs, starting with their 200% long Netflix ETF.

Investors who believe in Netflix’s continued growth or who want to make strategic short-term trades now have a powerful tool at their disposal.

With more ETFs on the horizon, including an inverse version, Netflix might just be the start of the “second-tier” stocks poised to capture investor attention.

Key Takeaways:

• NFLU ETF: Offers 200% exposure to Netflix’s daily stock price.
• Tuttle Capital Management: Leading the charge with the next wave of single-stock ETFs.
• Growth of Leveraged ETFs: The sector continues to expand, providing more options for investors.
• Inverse ETF Filed: Netflix’s inverse ETF is expected soon, allowing for both long and short strategies.