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SP500 Index – 4X leverage

07.12.2023

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The exchange-traded product, which allows investors to make large bets on the S&P 500, launched Tuesday, according to a press release from its sponsor, Bank of Montreal. It’s called the MAX S&P 500 4X Exchange Traded Note XXXX and offers investors daily returns four times the S&P 500 Total Return Index. The fund’s sponsor, Max ETNs, already offers four other leveraged ETNs offering 3x exposure to aviation and automotive industry. The ETN began trading on Tuesday on the NYSE Arca under the ticker symbol “XXXX.” The product’s backers called it an “innovative tool” for investors.

“With the launch of these 4X leveraged ETNs, we continue to foster a diversified and dynamic investment environment,” Adam Stempel, managing director of BMO Capital Markets, said in a press release. “As investors seek strategies to navigate changing market conditions, we provide access to innovative tools designed to meet their diverse needs.”

The stock exchange and its purpose of existence have always been focused on attracting additional capital for the development of the company and aimed at long-term investors. Now such events are more reminiscent of competition with cryptocurrency markets and are focused on an army of speculators, hinting that traditional financial instruments are increasingly fading into the background.