Exchange-traded funds (ETFs) are often used for investing in a broad range of stocks. When you think of ETFs, you might envision funds that have dozens if not hundreds of holdings. After all, that's a big appeal of them – having a stake in a variety of businesses rather than just a single one.
But, there are new single-stock ETFs that are available. AXS Investments has launched leveraged ETFs that can help you short a stock and use leverage to amplify your return from it. Shorting a stock is risky as your losses can be unlimited if it skyrockets in value. By going through a single-stock ETF, however, investors have a safer way to do that as you aren't technically shorting a stock. It's still can be a risky move, but it prevents your losses from being unlimited.
One single-stock ETF that AXS has launched is one that shorts Tesla (NASDAQ:TSLA). The AXS TSLA Bear Daily ETF (NASDAQ:TSLQ) allows investors to bet against the popular electric vehicle maker. AXS says these single-stock ETFs are intended for short-term purposes and TSLQ looks to achieve the inverse of how Tesla's shares perform every day. One of the drawbacks is that the ETF isn't cheap; at 1.15%, its net expense ratio is fairly high.
AXS also has other single-stock ETFs, some that are bearish while others that are bullish. Using leveraged ETFs, you can make larger returns – but your losses can also be steeper. AXS gives investors some new investment vehicles to pursue, but investors should tread carefully as these are much riskier options than your usual ETFs.
