Direxion, the second-largest issuer of leveraged ETFs, will introduce two new triple-leveraged country-specific funds Wednesday.
South Korea, one of the laggards in a disappointing year for some emerging markets, will finally get a triple-leveraged ETF in the form of the Direxion Daily South Korea Bull 3X Shares (NYSE: KORU).
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KORU will aim to provide three times the daily performance of the MSCI South Korea Index, the index used by the iShares MSCI South Korea Capped Index Fund (NYSE:EWY).
Direxion's other new entrant to the world of triple-leveraged bullish emerging markets ETFs is the Direxion Daily Brazil Bull 3X Shares (NYSE: BRZU). BRZU will seek to deliver three times the daily performance of the MSCI Brazil Index, the same index tracked by the iShares MSCI Brazil Capped Index Fund (NYSE:EWZ).
The timing of the debuts for BRZU and KORU is interesting considering EWZ, like EWY, has had its share of woes this year. Then again, Brazilian and South Korean stocks rebound, BRZU and KORU could be very rewarding to some traders.
KORU is the first leveraged play on South Korea while BRZU will face competition in the form of the double-leveraged ProShares Ultra MSCI Brazil (NYSE:UBR). UBR is nearly three years old.
Direxion currently has three other leveraged country-specific bullish emerging markets ETFs trading. Those are the Direxion Daily Russia Bull 3X Shares (NYSE:RUSL), the Direxion Daily China Bull 3X Shares (NYSE:YINN) and the Direxion Daily India Bull 3X Shares (NYSE:INDZ).
Direxion has filed regulatory paperwork to possibly introduce bearish equivalents to BRZU and KORU. The two new ETFs will each have expense ratios of one percent per year.
Massachusetts-based Direxion is the 15th-largest U.S. ETF sponsor with $5.58 billion in assets under management as of April, according to Index Universe data.
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