Leveraged ETFs tracking SanDisk Corp.
(NASDAQ:SNDK) tumbled sharply after the memory-chip maker's latest earnings report, highlighting the downside risks of single-stock leveraged funds when lofty investor expectations collide with cautious guidance.
The Leverage Shares 2X Long SNDK Daily ETF (BATS:SNDG) fell 10.8% on Wednesday and plunged more than 20% in Thursday's premarket session.
The selloff was echoed by the T-REX 2X Long SNDK Daily Target ETF (BATS:SNDU) and the Tradr 2X Long SNDK Daily ETF (BATS:SNXX), both of which also dropped sharply as SanDisk shares extended their post-earnings decline.
The move marks a dramatic reversal for the ETFs, which remain highly sensitive to daily swings in the underlying stock.
