TransWikia.com

Why are there no exchange traded options on 3x leveraged ETNs

Personal Finance & Money Asked on December 5, 2020

Since these would help me manage risk in my personal financial portfolio, why are there no exchange traded options on 3x leveraged ETNs?

Is there a prohibition that the SEC is perpetuating? Is there an agreement amongst exchanges not to trade them? If the SEC is approving/disapproving these particular products, what authority is that based on?

I’ve anecdotally heard “too much leverage” before, but there are ways to get more leverage than options would provide and it also isn’t law (although the SEC has historically unparalled discretion over how ETFs and ETNs operate), so any insight into this would be great

2 Answers

Are you referring to a specific type of ETN? Because leveraged ETNs do exist: http://etf.about.com/od/etfbasics/a/List-Of-Etns.htm

Some examples of 3x leveraged ETNs:
UUPT (POWERSHARES DB 3X LONG US DOLLAR INDEX FUTURES)
BUNT (POWERSHARES DB 3X GERMAN BUND FUTURES)
DGLD (VS 3X INVERSE GOLD LINKED TO S&P GSCI GOLD)

See above list for more examples.

Answered by jlewkovich on December 5, 2020

It may be that exchanges don't perceive there to be enough trading interest to warrant the set up and running cost. I guess you would have to ask them...

Answered by ThatDataGuy on December 5, 2020

Add your own answers!

Ask a Question

Get help from others!

© 2024 TransWikia.com. All rights reserved. Sites we Love: PCI Database, UKBizDB, Menu Kuliner, Sharing RPP