Leverage Shares 3x Microsoft ETP Securities (MSF3l)

Overview

Leverage Shares 3x Microsoft ETP Securities is an exchange-traded note (ETN) based in Ireland, specifically designed to deliver triple the daily performance of Microsoft Corporation's common stock (MSFT). This leveraged offering enhances both potential gains and potential losses derived from the daily returns of the underlying stock. The performance is adjusted for various fees and costs incurred while managing the leveraged position, which includes physical ownership of Microsoft shares and borrowing additional shares for the leverage effect. Issued by Leverage Shares PLC, this ETP tracks a leveraged index, such as the ISTOXX 3X MSFT or a similar benchmark. It employs daily rebalancing strategies to ensure the 3x exposure is maintained, featuring an intraday mechanism aimed at alleviating significant intra-day volatility. The securities are traded like equities across multiple European exchanges in various currencies, including EUR, USD, and GBP, which provides liquidity through authorized participants and market makers. Notable characteristics of this product include transparency resulting from full asset backing, the avoidance of derivatives in its core strategy, and the accumulation of dividends. It is primarily targeted toward sophisticated investors who are actively monitoring short-term fluctuations within the technology sector, particularly influenced by advancements in Microsoft’s cloud computing, software, and artificial intelligence sectors. The high-risk nature of this leveraged instrument, which offers amplified exposure to a leading global technology firm, is emphasized by its ISIN of IE00BK5BZV36.

Products and Services

• Leverage Shares 3x Microsoft ETP Securities

  This is the primary product of Leverage Shares, which provides an investment vehicle allowing investors to gain 3x exposure to the daily performance of Microsoft’s stock. The product utilizes leverage to amplify both profits and losses compared to the underlying asset.

• Daily Rebalancing Mechanism

  This service helps maintain the desired level of exposure throughout the day. By rebalancing daily, the ETP seeks to keep its performance aligned with the targeted 3x leverage, ensuring that any deviations due to price movements are corrected regularly.

• Intraday Volatility Mitigation

  To address the potential for extreme price fluctuations within the trading day, the ETP includes mechanisms designed to mitigate volatility. This ensures smoother performance and reduced risk for investors during market disturbances.

• Asset-backed Transparency

  The product offers full transparency through its asset backing, giving investors confidence that the ETP's performance is directly tied to tangible holdings of Microsoft shares. This feature aims to build trust among sophisticated investors.

• No Derivatives Strategy

  The core strategy of the ETP avoids utilizing derivatives, focusing instead on physical ownership of the underlying assets. This approach seeks to simplify the investment process and reduce the complexity and risks associated with derivative trading.

• Dividend Capitalization

  This service allows the ETP to capitalize on any dividends paid by Microsoft, which enhances the overall return for investors. By reinvesting these dividends, the product aims to provide greater growth potential over the long term.