ETF SPOTLIGHT, New Single-Stock ETFs Come With Plenty of Risk

The exchange-traded fund industry is nothing if not innovative.

-  ANNE KATES SMITH

The exchange-traded fund industry is nothing if not innovative. And if you’ve got a strong appetite for risk and a very short outlook, a host of new ETFs will allow you to make outsize bets, up or down, on some of the market’s most meme- worthy stocks.

Single-stock ETFs use derivatives to give you a leveraged or inverse position in stocks such as Apple, Coinbase, Nvidia, PayPal, Tesla—even Nike and Pfizer. A leveraged bet means your returns will be amplified beyond the underlying stock’s performance; an inverse bet generally means you’re expecting the underlying share price to fall.

For example, the TSLA Bear Daily ETF (symbol TSLQ, $38) from AXS Investments, an inverse ETF, will gain 5% on a day when Tesla shares drop 5%; Direxion Daily TSLA Bull 1.5X Shares (TSLL, $26) would deliver a 7.5% loss that day (or a 7.5% gain on a day Tesla stock is