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Demand for Short and Leverage ETPs rise as Boost’s AUM reaches $209m, up 200% in 4 months

Tuesday 25th February '14

  • AUM and trading volumes of BOOST ETPs continue to reach new records
  • AUM rose by 200% in 4 months and trading volumes rose 2,000% in seven months 
  • The most popular BOOST ETP is Boost Natural Gas 3x Short Daily ETP (3NGS) and with $43m AUM, it is Europe’s largest short Natural Gas ETP
  • Boost’s 3x leverage FTSE MIB and 3x short FTSE MIB ETPs are Boost’s two most popular equity ETPs, with $44m AUM combined
  • Global AUM of short & leveraged ETPs reached a record of $56 billion at the end of January , with net inflows of $2.2bn YTD versus $10.6bn outflows from unleveraged ETPs due to increased market volatility 

BOOST ETP, Europe’s award winning, specialist Short and Leverage (S&L) Exchange-Traded Product (ETP) provider continues to break new trading records. Since mid-October, assets under management (AUM) in BOOST’s ETP platform has tripled to a high of $75 million, which is equivalent to AUM of $209m, taking leverage into account.   

The most popular BOOST ETP is Boost Natural Gas 3x Short Daily ETP (3NGS) with AUM of $43 million, taking leverage into account. This makes 3NGS Europe’s largest short Natural Gas ETP. Boost’s most popular equity ETPs are Boost FTSE MIB 3x Leverage Daily ETP (3ITL) and Boost FTSE MIB 3x Short Daily ETP (3ITS), which have a combined AUM of $44 million, taking leverage into account.

Globally, the AUM of S&L ETPs reached a record of $56 billion at the end of January 2014 , up $0.9 billion (or 1.7%) from December 2013, as investors continued to increase their usage of S&L ETPs globally. With current volatility in global markets, investors have withdrawn $10.0bn from unleveraged ETPs while short and leveraged ETPs have experienced $2.2bn of inflows. 

Consistent with rising AUM has been a large increase in exchange traded volumes. Trading volumes of BOOST ETPs on the London Stock Exchange and Borsa Italiana have recently been averaging around $10 million per day (equal to approximately $30m per day after taking leverage into account), which is an increase of 2,000% since June 2013. 

Co-CEO of BOOST ETP, Nik Bienkowski commented: 

“As we expected, demand for short and leverage ETPs is growing as investors understand the benefits of shorting and leveraging through an ETP. Recently, we have seen AUM and trading volumes increase significantly. This is due to the dual listing of Boost ETPs in both the UK and Italy, along with having an enviable operating track record. Global AUM in Short and leverage ETPs hit a high of $56 billion at the end of January.

The main reason for the recent spike in trading volumes has been volatile financial markets, resulting in investors seeking ETPs to either hedge portfolios, or to take short terms tactical bets that prices will fall or bounce back, and this seems to be a potential pattern investors are now faced with for 2014. As a result, although unleveraged ETPs have suffered outflows YTD, Short and Leverage ETPs have experienced significant inflows.” 

Investors are increasingly using S&L ETPs for a variety of reasons. There is wider product availability, greater product knowledge from improved educational resources, and increased demand for hedging tools and leveraged instruments available. There is also a move towards independent, transparent and exchange traded instruments such as ETFs and ETPs. As a result of this increased usage and interest in S&L ETPs, BOOST recently launched a monthly Short and Leverage ETF/ETP Global Flows Report and a Short & Leverage ETF / ETP Advisor Tool Kit.