Mirae Asset Management Publishes 'US Leverage ETF Guidebook'

Mirae Asset Global Investments announced on the 18th that it has published the ‘U.S. Leverage ETF Guidebook,’ which provides guidance on investing in U.S. leveraged exchange-traded funds (ETFs).

The U.S. Leverage ETF Guidebook introduces leveraged investing and presents leveraged investment solutions using major U.S. indices. The guidebook is available for free download on the TIGER ETF website.

Major U.S. indices have shown a steady upward trend based on long-term growth potential. This contrasts with the domestic stock market, which has shown box-range movements for a long time, making leveraged investment effects difficult to realize. From 2010 to 2023, the Nasdaq 100 leveraged index rose more than 4000%, and the U.S. Philadelphia Semiconductor leveraged index increased by over 3800%. In contrast, the KOSDAQ 150 leveraged index recorded -18%. Therefore, it is expected that long-term leveraged investment in major U.S. indices can maximize effectiveness.

The guidebook also analyzes leveraged ETF investment performance according to currency strategies. Even ETFs tracking the same index show different returns depending on currency strategies, and especially over long-term investments, cumulative performance differences emerge. An analysis of the returns of two types of Nasdaq 100 leveraged ETFs listed domestically from 2014 to 2023?currency-exposed and currency-hedged?showed that currency-exposed products outperformed. This is believed to be influenced by defensive strategies through currency exposure during index downturns as well as cost savings from avoiding currency hedging.

The guidebook also introduces two representative domestic leveraged ETFs tracking major U.S. indices. The ‘TIGER U.S. Nasdaq 100 Leverage (Synthetic) ETF’ invests with leverage in the Nasdaq 100 index, a global leading growth index. The ‘TIGER U.S. Philadelphia Semiconductor Leverage (Synthetic) ETF,’ which tracks the U.S. Philadelphia Semiconductor index, ranked first among all ETFs listed domestically in 2023 with an annual return of 173.8%. Recently, the semiconductor industry has gained more attention due to artificial intelligence (AI), and further growth is expected.

Kim Ji-yeon, Senior Manager of the Global ETF Management Division at Mirae Asset Global Investments, said, “With the full-scale development of the global AI industry, the upward trend of major U.S. indices is strengthening, increasing domestic investors’ interest in U.S. leveraged ETFs. Although there have been some negative views on leveraged ETFs, we created this guidebook to present a new investment solution through leveraged ETFs based on major U.S. indices with growth potential.”