Leveraged ETF Effect Calculator

The daily target and your holding-period return measure different things

A daily 3x ETF seeks three times its benchmark return for one day. Over several days, each return applies to the value left by the previous day. The resulting period return can be above or below three times the benchmark period return.

This calculator divides the product period return by the comparison asset period return. It does not measure daily exposure or test whether the fund met its daily target. Costs, tracking differences and using a reference ETF also affect observed results, so the ratio does not isolate compounding.

Two days show how compounding changes the result

These hypothetical examples start both assets at 100. The 2x product achieves exactly twice the underlying return each day. Costs, dividends and tracking differences are excluded. These are not historical ETF returns.

On the rising path, 100 × 1.10 × 1.10 = 121, while the product reaches 100 × 1.20 × 1.20 = 144. Its +44% return exceeds twice +21%. On the second path, the underlying ends at 99 and the product at 96. A rise followed by an equal percentage fall does not restore the starting value.

In the second example, this calculator hides the multiple because the absolute underlying return is below 3%. The two returns remain useful: a small underlying loss can accompany a larger product loss.

Read the returns before judging the multiple

For a 2x target, an underlying return of +30% and product return of +72% give 2.40x realized leverage. Efficiency is 120%, and relative to target is +20%. That +20% describes the multiple relative to the target. The return gap is 42 percentage points; it is a different measure.

If the underlying falls 10% and the product falls 25%, the loss multiple is 2.50x. A higher multiple then means a larger loss, not a better result. Efficiency is a return-ratio measure; it does not rate fund quality or risk-adjusted performance. When return signs differ, compare the returns directly because the calculator hides the multiple.

Change the period and check what the comparison leaves out

Manual mode compares only your four purchase and current prices. It cannot show the daily path or maximum drawdown. Use matching dates and consistent split adjustments. Selecting 1x through 10x sets the comparison target; it does not generate a hypothetical product price.

This is a price-return comparison. Dividends, personal taxes, trading fees and currency conversion are excluded. A dividend-inclusive backtest or an actual account can therefore differ. For additional context, compare dividend settings and the benchmark in the asset backtest.

Compare dividend settings in the asset backtest →