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Nvidia Sparks Double-Digit Rally in These Leveraged ETFs

U.S. stocks reached new peaks on Thursday, propelled by Nvidia’s NVDA blockbuster earnings report. Both the S&P 500 and Dow Jones concluded the day at all-time highs, gaining 2.2% and 1.2%, respectively. The Nasdaq Composite Index closed the day just below its peak but outperformed the other indices, rising 3.1%.

Notably, the Nasdaq 100 spiked more than 3% to achieve a historic high, marking its most significant single-day gain since March 2000, according to Bespoke Investment Group.

The broad rally injected double-digit gains in the leveraged space. We have highlighted five of these that led the way higher in Thursday's trading session. These include GraniteShares 2x Long NVDA Daily ETF NVDL, ProShares Ultra Semiconductors USD, BMO REX MicroSectors FANG+ Index 3X Leveraged ETN FNGU and GraniteShares 2x Long COIN Daily ETF CONL. These funds will continue to be investors’ darlings, at least in the near term, provided the sentiments remain bullish.

A Peek into Nvidia’s Earnings

This leading U.S. chip designer exceeded fourth-quarter earnings and revenue expectations. The company reported a staggering 265% increase in revenues and provided an optimistic outlook, indicating a surge in demand for AI hardware. This not only showcased Nvidia's robust position in the AI chip market but also signaled promising prospects for the semiconductor industry in 2025 and beyond (read: Nvidia Drives AI and Semiconductor Stocks: ETFs to Gain).

Nvidia has been the biggest beneficiary of technology companies' race to build AI into their products and services. Nvidia founder and CEO Jensen Huang said that “accelerated computing and generative AI have hit the tipping point. Demand is surging worldwide across companies, industries and nations.”

Nvidia's stock jumped about 16% in Thursday, achieving a new high and adding $277 billion to its market cap — the biggest one-day boost ever recorded. The one-day gain topped Meta Platforms Inc.’s (META) historic gain just three weeks ago.

The bullish sentiment extended globally, with advancements in chip stocks leading Japan's Nikkei 225 to surpass a record set in 1989 and the pan-European Stoxx 600 hitting a new all-time intraday high.

Leveraged ETF Picks

GraniteShares 2x Long NVDA Daily ETF (NVDL) – Up 32.3%

GraniteShares 2x Long NVDA Daily ETF magnifies exposure to a single trade, seeking two times (200%) the daily percentage change of the common stock of Nvidia (NVDA). It has an expense ratio of 1.15% and has amassed $700.2 million in its asset base (read: Nvidia ETFs to Tap for More Growth Post Blowout Q4 Earnings).

ProShares Ultra Semiconductors (USD) – Up 18.5%

ProShares Ultra Semiconductors offers two times exposure to the daily performance of the Dow Jones U.S. Semiconductors Index. It has gathered $583.1 million in its asset base and charges 95 bps in fees per year from investors.

BMO REX MicroSectors FANG+ Index 3X Leveraged ETN (FNGU) – Up 13.7%

BMO REX MicroSectors FANG+ Index 3X Leveraged ETN seeks to offer three times leveraged exposure to the NYSE FANG Index. The Index includes 10 highly liquid stocks that represent industry leaders across today’s tech and internet/media companies. BMO REX MicroSectors FANG+ Index 3X Leveraged ETN charges 95 bps in annual fees. It has accumulated $3.9 billion in its asset base.

GraniteShares 2x Long COIN Daily ETF (CONL) – Up 10.7%

GraniteShares 2xLong COIN Daily ETF seeks two times the daily percentage change of the common stock of Coinbase Global Inc (COIN). It has accumulated $77.7 million in its asset base and charges 115 bps in annual fees.

Bottom Line

As a caveat, investors should note that these products are extremely volatile and suitable only for short-term traders. Additionally, the daily rebalancing — when combined with leverage — may make these products deviate significantly from the expected long-term performance figures (see: all the Leveraged Equity ETFs here).

Still, for ETF investors bullish on the stock market for the near term, either of the above products can be an interesting choice. Clearly, a near-term long could be intriguing for those with high-risk tolerance and a belief that the trend is the friend in this corner of the investing world.

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NVIDIA Corporation (NVDA) : Free Stock Analysis Report

ProShares Ultra Semiconductors (USD): ETF Research Reports

MicroSectors FANG+ Index 3X Leveraged ETN (FNGU): ETF Research Reports

GraniteShares 2x Long COIN Daily ETF (CONL): ETF Research Reports

GraniteShares 2x Long NVDA Daily ETF (NVDL): ETF Research Reports

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