Series 65: 3.4.1 Non-Traditional ETFs

3.4.1  Non-Traditional ETFs

ETFs as just described are called traditional ETFs. They can be contrasted with riskier non-traditional ETFs. Two types of non-traditional ETFs are leveraged and inverse ETFs.

Leveraged ETFs use derivative products such as equity futures, options, and swaps to receive daily returns two to three times above the returns of the index they are tracking. For example, a triple-leveraged ETF is on