Defiance ETFs launches leveraged fund tracking space-focused portfolio

Defiance ETFs announced the launch of the Defiance Daily Target 2X Long XOVR ETF (XOVL), a leveraged exchange-traded fund that seeks to deliver 200% of the daily percentage change in the ERShares Private-Public Crossover ETF (NASDAQ: XOVR).

The underlying XOVR fund combines investments in entrepreneurial U.S. public companies with allocations to select late-stage private companies. XOVL is designed for short-term trading and daily rebalancing, according to the company's statement.

The fund targets daily investment results of two times the daily percentage change in XOVR's share price, before fees and expenses. The investment objective applies only to single trading days rather than longer periods.

XOVR holds a portfolio that includes both publicly traded entrepreneurial companies and private late-stage firms. The fund uses ERShares' proprietary ER30TR Index and Entrepreneur Factor research framework for its public equity selections.

Defiance ETFs stated that XOVL carries significant risks, including potential total principal loss within a single trading day. The fund uses leverage through swap agreements and options contracts based on XOVR's share price. Daily compounding effects mean performance over periods longer than one day will likely differ substantially from 200% of XOVR's return over the same period.

The fund is classified as non-diversified and may concentrate investments in single issuers. Tidal Investments, LLC serves as the investment adviser, while Defiance ETFs LLC sponsors the fund.

XOVL faces risks related to the underlying portfolio's exposure to private companies, which are less liquid and transparent than public securities. The fund also carries exposure to growth and technology sectors, which may experience higher volatility during market stress periods.

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