The GraniteShares 2x Long NVDA Daily ETF offers leveraged exposure to Nvidia, ideal for investors bullish on AI-driven gains. Nvidia's explosive growth in AI GPUs and free cash flow makes leveraged exposure attractive, but the ETF is high-risk and suitable only for highly risk-tolerant investors. NVDL has delivered strong net asset value returns since inception, but it can underperform Nvidia over time due to beta-slippage.
I maintain my buy rating on GraniteShares 2x Long NVDA Daily ETF, as Nvidia's technicals and bullish seasonality suggest further upside despite the recent rally. NVDA stock's valuation remains reasonable given its growth trajectory, with a potential breakout above $153 targeting $220 long-term. Leveraged ETFs like NVDL are risky and best suited for knowledgeable, active traders seeking short-term opportunities in NVDA's momentum.
The Magnificent Seven stocks have stumbled in 2025, while defensive niches like gold miners have surged, with gold miners up 55% YTD. I am upgrading the GraniteShares 2x Long NVDA Daily ETF to a buy, seeing NVDA as washed out and undervalued below $90. May has been NVDA's best month on the calendar, and earnings are on tap.
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This company operates within the financial sector, focusing on creating investment opportunities through swap agreements with major financial institutions. Swap agreements are financial contracts where two parties agree to exchange the financial returns of different kinds of investments. In this case, the company and its partner institutions exchange returns based on the performance of an underlying stock. The agreements may vary in duration, ranging from as short as a day to over a year. This setup allows investors to gain exposure to the performance of specific stocks without directly owning them. The fund operates on a non-diversified basis, meaning it may choose to invest a significant portion of its assets in a limited number of swaps, potentially increasing the fund's risk and return profile.
Swap agreements are the primary offering of this company, involving a contractual arrangement between the fund and major financial institutions. These agreements are keyed to the performance of an underlying stock. They enable the exchange of returns or differentials in rates of return over a specified period. This product is designed for investors looking for exposure to specific assets or seeking to hedge other investments, without the need for direct investment in those assets.
The investment strategy of the fund is explicitly non-diversified, allowing it to concentrate investments in specific swap agreements. This approach can lead to higher volatility and potentially higher returns, appealing to investors with a higher risk tolerance. By focusing on a limited number of high-conviction swaps, the fund aims to achieve significant growth, albeit with an increased risk profile.