ETFs
ProShares Launches Inverse and Leveraged Ether ETFs | ETF Strategy
Pro Shares has introduced two new tactical crypto-related ETFs in the United States for investors seeking leveraged or short exposure to the price of ether.
Ether has seen notable price volatility recently, due to growing anticipation for upcoming Ether ETFs.
THE ProShares Ultra Ether ETF (ETHT US) offers twice the daily performance (+200%) of Bloomberg Ethereum Indexwhile the ProShares UltraShort Ether ETF (ETHD US) returns twice the inverse (-200%) of the same index.
ETHT and ETHD are listed on NYSE Arca with expense ratios of 0.94% and 1.01%, respectively. Notably, ETHD is the first ETF in the United States to offer inverse leveraged exposure to Ether, the world’s second-largest crypto asset by AUM.
The Bloomberg Ethereum Index, a composite of USD ether trading activity on select digital asset platforms, measures the performance of a single ether traded in US dollars. These platforms are evaluated based on their governance, liquidity and data integrity.
According to prospectus documents, the ETFs invest in financial instruments such as ether futures and money market instruments, which ProShares believes are expected to produce daily returns consistent with the funds’ objectives. Neither ETF invests directly in ether.
Ether has seen notable price volatility recently, due to growing anticipation for upcoming Ether ETFs. Market enthusiasm for these potential new investment vehicles has fueled speculative trading, contributing to sharp price movements. As regulatory approvals for these ETFs appear increasingly likely, investors are positioning themselves to capitalize on the expected influx of institutional funds, further amplifying ether price momentum.
Investors should note that inverse and leveraged ETFs are only suitable for sophisticated traders who understand the risks involved. The value of these products tends to decline if held for an extended period of time, which may result in significant losses, particularly in volatile but limited markets.
Michael L. Sapir, CEO of ProShares, commented: “We are excited to introduce ETHT and ETHD. These new ETFs are designed to address the challenge of acquiring leveraged or short exposure to ether, which can be onerous and expensive.
“ETHT offers investors the opportunity to seek amplified returns on ether or target a level of exposure with less money at risk. ETHD allows investors to seek profits when the price of ether falls or to hedge their exposure to ether.