XTrackers LevDAX Daily Swap UCITS ETF 1C

Issuer: Xtrackers

Asset Class: Equity

TER: 35bps

Trading Currency: GBX

Pays Income: False

Listing Date: 10 May 2010

Ticker: XLDX

ISIN: LU0411075376

This financial instrument offers a tactical approach for investors aiming to amplify their exposure to the German equity market. It is engineered to deliver twice the daily performance of Germany's benchmark stock index, which comprises the country's largest and most liquid blue-chip companies. This makes it a powerful tool for those with a strong, short-term bullish conviction on the direction of the German economy and its leading corporations. By doubling the daily returns, investors can potentially achieve significant gains from positive market movements in a short timeframe, making it suitable for aggressive, tactical trading strategies rather than long-term investment portfolios.

It is crucial for prospective investors to understand the mechanics and inherent risks of this product. The leverage is reset on a daily basis, which introduces the effect of compounding. Over periods longer than a single day, the fund's return may not be exactly two times the benchmark's return. In volatile markets, this daily rebalancing can lead to a 'volatility drag' that negatively impacts performance. Therefore, this product is intended for sophisticated investors who can actively manage their positions and fully comprehend the risks associated with daily leveraged instruments. It is not designed for buy-and-hold strategies or for individuals with a low tolerance for risk.