Investment Managers Series Trust II Tradr 1.5X Short NVDA Daily ETF (NVDS) seeks to provide 1.5 times the inverse daily performance of NVIDIA Corporation stock. This leveraged inverse ETF profits when NVIDIA shares decline, delivering amplified returns opposite to the semiconductor giant's daily price movements.
How It Works
NVDS uses derivatives including swaps and futures contracts to achieve -150% of NVIDIA's daily return through mathematical replication rather than short selling actual shares. The fund rebalances daily at market close to maintain its 1.5x inverse exposure target. As a single-stock inverse ETF, it holds derivative instruments and cash collateral rather than equity positions, with daily reset mechanisms that compound returns over multi-day periods in non-linear fashion.
Key Features
- Provides 1.5x amplified inverse exposure to NVIDIA specifically, not broader semiconductor or technology sector indices
- Daily rebalancing ensures precise -150% correlation to NVIDIA's single-day moves but creates compounding effects over time
- Launched in 2022 during NVIDIA's AI boom, offering tactical hedging tool for concentrated tech positions
Risks
- This ETF can lose value rapidly if NVIDIA stock rises, with potential for 30-50% daily losses during strong NVIDIA rallies due to 1.5x leverage amplification
- Daily rebalancing causes compounding decay over multi-day periods—even if NVIDIA returns to original price, this ETF may show permanent losses
- Single-stock concentration means NVIDIA-specific events like earnings, product launches, or regulatory changes create extreme volatility beyond normal market movements
Who Should Own This
Designed exclusively for sophisticated day traders and tactical investors with high risk tolerance seeking short-term hedging against NVIDIA positions. Maximum holding period of 1-3 days recommended due to daily reset mechanics. Should represent less than 5% of portfolio as speculative position, not core holding.