Leveraged ETF is a very popular financial derivative in traditional financial market. It is a product that tracks the yield rate of underlying assets (e.g. BTC) with certain times (e.g. 3 times). For example, if BTC gains 1%, the net value of corresponding 3 times ETF product will rise 3%, while the -3 times product will decrease 3%.
Leverage ETF is a perpetual product that there’s no settlement day. Theoretically, its price will not completely approach zero, so there’s no liquidation risks. Investors are able to buy/sell it at the secondary market at any time with no need of margin.
The value of leveraged ETF product is calculated in USDT. Its trading is very similar to spot trading. Leveraged ETF, essentially, is a fund in shares that are pegged with the return rate of underlying asset with certain times. Investors are able to obtain yield times more than that of the underlying asset by trading leveraged ETF products. When the underlying assets fluctuate against the leveraged ETF you bought over a given threshold figure, the fund management party will rebalance the fund position to ensure the loss not exceeding a limited amount.
Simply put, investors are able to gain the yield of underlying assets with certain times by trading the corresponding leveraged ETF product which is free of liquidation risks via control measures taken by fund management agent.
BKEX now support 3 times long leverage (3L) and 3 times short leverage (3S). Users can check the leveraged ETF products by [Official website – Market – ETF].
Leveraged ETF is an emerging financial product. The content above does not constitute investment advice. Please watch out investment risks.
Leveraged ETF reduces the risks of liquidation, but in extreme conditions there’s possibility that the price will approach zero and be liquidated. Please pay attention to the difference between order price and net value, to avoid losses.