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SHORT & LEVERAGED ETP CENTRE

 

The WisdomTree Short & Leveraged (S&L) family of exchange traded products (ETPs) is one of the most comprehensive, innovative ranges of specialist S&L ETPs in the world. Our extensive Short & Leveraged platform offers a range of fully collateralised ETPs which are available in leverage factors between -5x and +5x. 

 

Through these award-winning products, investors can access a broad range of Equities, Commodities, Fixed Income, Alternatives and Currency strategies, meaning they can look to magnify returns on a daily basis through positive or inverse leverage, take a hedging position efficiently, and access alternative or unique strategies.

 

This specialised branch of ETPs, like other investment products offering short and leveraged exposure, requires a certain level of understanding and due diligence. In this centre, WisdomTree aims to provide an informative reference point for investors seeking to educate themselves about the opportunities and the risks presented by short and leveraged ETPs.

S&L HEATMAP

 

The WisdomTree S&L heatmap illustrates the daily movement of underlying benchmarks for all asset classes. 

 

MARKET NEWS

Strong fundamentals push Palladium price to record high

20 Feb 2020

Palladium prices are on a tear, as safe-haven demand coupled with forecasts of a widening deficit supports its record-breaking rally. Palladium’s demand outlook (nearly 80%) is closely linked to the automotive market, used heavily in catalytic converters in gasoline powered vehicles, while car sales in China declined 20% year on year in January 2020, according to China Association of Automobile Manufacturers. Tighter emission standards, particularly in China, which is dominated by gasoline powered vehicles, have offset this as higher loadings of palladium are required to achieve this.  Palladium’s sister metal, Platinum, used in auto catalysts in diesel powered vehicles, has been left behind in the price rally, rising only 3.87% in 2020 compared to 39.3% for palladium in 2020 (as of 19 February 2020). So far, palladium’s substitution with platinum has been muted in auto catalysts despite the wide price gap.

 

Source: Bloomberg, WisdomTree as of 19 February 2020.

Historical performance is not an indication of future performance and any investments may go down in value.

Gold at a seven-year high

19 Feb 2020

Gold is trading near a seven-year high as coronavirus fears continue to drive investors towards the historically safe-haven asset. Coronavirus deaths in China topped 2,000, while there have been 2010 deaths worldwide. Globally there have been over 75,000 cases of the disease. Equity markets appeared to be brushing off the effects of the virus, until yesterday when Apple Inc reported that its earnings will take a beating as the virus damages supply chains. Representing close to 5% of the S&P500, the single company has an outsized weight on investor sentiment. Gold is a natural port of call in times of investor anxiety. Closing above the psychologically important US$1600/oz for the first time in seven years, gold is showing its mettle in times of uncertainty.

 

Source: Bloomberg, data as of 19/02/2020.

Historical performance is not an indication of future performance and any investments may go down in value.

China’s central bank injects liquidity to counter coronavirus related slowdown

17 Feb 2020

China’s central bank has provided medium term funding to commercial lenders and cut the interest rate it charges in trying to cushion the economy from the virus epidemic. Chinese equity markets also gained in lockstep with global equity markets. The People’s Bank of China has offered 200 billion yuan ($29 billion) of one-year medium-term loans. The interest rate was lowered by 10 basis points to 3.15%, the lowest since 2017. The central bank has also pumped 900 billion yuan into the financial system via reverse repurchase agreements (reverse repos) to offset the impact of reverse repos maturing and to maintain ample liquidity in the banking system.

 

RESOURCES & TOOLS

 

Browse through our educational content and simulator to understand more how Short & Leveraged products work, and what are the latest trends in the industry. 


SHORT & LEVERAGED ETP SMART FAQ

Ask us anything about Short & Leveraged ETPs through our S&L ETP Smart FAQ search.

ANIMATED INTRODUCTION TO SHORT & LEVERAGED ETPS

Watch our short, animated video for a quick introduction to S&L ETPs

GUIDE TO SHORT & LEVERAGED ETPS

Access our Guide to Short and Leveraged ETPs to understand more of the risks and benefits of S&L ETPs and how they may be used in a portfolio

S&L ETP MONTHLY FLOW

See the latest trends in the S&L ETP industry through our Monthly S&L ETP Flows report.

SHORT & LEVERAGED ETP SIMULATOR

Use our short & leveraged ETP simulator to model returns of a theoretical short & leveraged ETP across different market scenarios.

Important information

 

Short & Leveraged Exchange-Traded Products are only intended for investors who understand the risks involved in investing in a product with short and/or leveraged exposure and who intend to invest on a short-term basis. Any investment in short and/or leveraged products should be monitored on a regular basis (as frequently as daily) to ensure consistency with your investment strategy. You should understand that investments in short and/or leveraged exchange-traded products held for a period of longer than one day may not provide returns equivalent to the return from the relevant unleveraged investment multiplied by the relevant leverage factor. Potential losses in short and/or leveraged exchange-traded products may be magnified in comparison to investments that do not incorporate these strategies. Please refer to the section entitled “Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in short and/or leveraged exchange-traded products. You should consult an independent investment adviser prior to making an investment in short and/or leveraged exchange-traded products in order to determine suitability to your circumstances.