Leveraged ETF Exposure Climbs to $420 Billion, Near Record Highs
US-listed leveraged ETF market exposure has risen to $420 billion, the highest since early July, after gaining more than $100 billion in three weeks.
Demand for leveraged ETFs continues to accelerate. Total US-listed leveraged ETF market exposure now stands at $420 billion, the highest level since early July. Over the past three weeks, exposure has increased by more than $100 billion.
Assets under management have also moved higher, rising $40 billion to $180 billion. The gap between AUM and exposure reflects the structure of these products: a 2x ETF with $100 billion in assets creates $200 billion in market exposure, while a 3x ETF creates $300 billion. That puts the true market impact of leveraged ETFs at nearly 2.5 times their reported AUM.
At the current pace, both metrics are on track to surpass their June all-time highs as soon as next month. The data highlights that leverage in the market has never been higher.
Source: The Kobeissi Letter