EZJ Profile
The ProShares Ultra MSCI Japan ETF is designed to deliver twice the daily performance of the MSCI Japan Index, which measures the performance of large- and mid-cap stocks in Japan. This fund uses financial instruments such as futures contracts, options, and swaps to achieve its investment objective, aiming to provide investors with a leveraged exposure to Japanese equities. The ETF seeks to magnify the returns of the index on a daily basis, making it a tool for traders who want to capitalize on short-term movements in the Japanese market.
The underlying MSCI Japan Index adjusts the market capitalization of its constituent stocks based on their free float, ensuring that only the shares available for trading are considered. The index includes approximately 85% of the free float-adjusted market capitalization of Japanese equities, offering a broad representation of the market while excluding smaller or less liquid stocks. This methodology provides a comprehensive view of the large- and mid-cap segments of the Japanese stock market.
ProShares employs a strategy involving a combination of derivatives and other financial instruments to achieve the fund's objective of delivering twice the daily return of the MSCI Japan Index. The leveraged nature of the fund means that it aims to double the index's performance on a daily basis, which can lead to amplified gains or losses. This makes the ETF suitable for investors with a high risk tolerance who are looking to make short-term trades based on their market outlook.
Given its non-diversified approach, the ProShares Ultra MSCI Japan ETF focuses exclusively on Japanese equities, with a leverage factor that increases both potential returns and risk. Investors should be aware of the daily resetting of leverage and the associated volatility when considering this ETF. It is intended primarily for tactical trading and not for long-term holding due to the compounding effects of leverage, which can lead to significant deviations from the index’s performance over extended periods.
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