Go super long or super short these top 2 stocks
There are now new, but risky, ways to make big bets for and against Tesla and Nvidia
Tesla’s stock tends to be extremely volatile. Take a look at how it’s doing today after a disappointing earnings report and conference call. Shares of Elon Musk’s electric car giant are down nearly 10%. But if that’s not enough of a move for you, check out some new ETFs that allow you more exposure on both the short and long (for those days when Tesla rallies) side of the Tesla trading coin.
ETF firm REX Shares partnered with Tuttle Capital Management, a leader in thematic investing, to launch the the T-REX 2X Long Tesla Daily Target ETF (TSLT) and T-REX 2X Inverse Tesla Daily Target ETF (TSLZ). (Tuttle has an ETF that bets against Cathie Wood and her stock picks for the Ark Innovation fund. I wrote about that in 2021 during my prior life as a CNN Business reporter.)
REX Shares and Tuttle also have two new leveraged ETFs for another super popular stock: Nvidia. They set up the T-REX 2X Long NVIDIA Daily Target ETF (NVDX) and the T-REX 2X Inverse NVIDIA Daily Target ETF (NVDQ).
Nvidia shares have surged this year, propelling the company to a market value above $1 trillion. But the stock has fallen recently on concerns about the US crackdown on AI chips to China. (I wrote for InvestorPlace about why that sell-off might be an overreaction.)
So does it make sense to place outsized bets on individual stocks? Not really. These products are not for the faint of heart or the novice investor. As REX Shares and Tuttle point out in the press release, the funds “are built for sophisticated traders looking to enhance potential returns via pinpoint positioning.” I wrote last year for CNN Business about the launch of single-stock ETFs by another firm, AXS Investments. As I said at the time, “this is a highly risky strategy geared toward many of the short-term traders in the Reddit WSB crowd and is just another example of the casino-like atmosphere in the market.”
Looks like the casino is still open for business.