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It has been a euphoric year for major US indices, which remained in positive territory despite the increasingly challenging macro environment this year.
However, most gains were driven by investor hype surrounding AI and came from a narrow selection of stocks labelled by the media as the “Magnificent 7”: Apple, Microsoft, Meta, Amazon, Alphabet, Nvidia, and Tesla,
These leading tech companies have been critical in lifting the S&P 500 and Nasdaq 100 index into double-digit returns. Excluding their contribution, both indices would have reverted to a negative year-to-date performance.
In their recent earnings release, they all posted robust numbers, beating expectations, except for Tesla. It missed estimates across the board as Elon Musk cited high-interest rates as a major reason for the abysmal Q3 results. This setback has seen Tesla’s stock plummet approximately 33% from its 52-week highs.
Nvidia is also up for a major correction. The leading chipmaker is facing a potential cancellation of a $5 billion China order due to US curbs. This could be the potential catalyst that causes Nvidia to break a critical $395 support level and fall all the way to $375, as it is facing a declining head and shoulders pattern. If it fails to hold the $375 level, this could spell disaster and a potential nosedive to $325.
The AI mania bubble burst is another major reason as to when these seven heavy hitters are due for or are in the middle of a correction.
Times change, but human behavior does not. Interest from Google trends in key phrases such as “Artificial intelligence” and “AI stocks” had declined substantially since they peaked in June, as visible by a downward pointing red arrow.
If we illustrate those seven tech giants as one, it would be the “Magnificent 7 ETF”. It has formed a triple top that has failed to break the resistance level three consecutive times, over the past few months, and now the rally is deflating, as triple tops usually do not work in favour of the bulls.
So far, Nvidia and Tesla are leading the downward trend, but others might follow soon.
Traders are facing a dangerous cocktail of high-interest rates, escalating geopolitical conflicts, oil prices spiking, and inflation creeping up again, causing panic among market participants. “Big 7” collectively lost nearly $2 trillion of their market capitalization from their 52-week highs, as this trade is reversing.
As the tech titans tumble, so will the mighty S&P 500, as the group collectively accounts for around 30% of the SPX’s total market capitalization.
Traders can long constituents of the “Big 7” stocks using our:
1x Apple
, 2x
Apple,
3x Apple
1x Microsoft , 2x Microsoft , 3x Microsoft
1x Facebook , 2x Facebook , 3x Facebook
1x Amazon , 2x Amazon , 3x Amazon
1x Alphabet , 2x Alphabet , 3x Alphabet
1x Tesla , 2x Tesla , 3x Tesla
Traders can long S&P 500 index using our 3x US 500 , 5x Long US 500 .
Alternatively, they can short one of the “Big 7” stocks using our:
-1x Tesla , -2x Tesla , -3x Tesla
Or they can short S&P 500 index using our -3x US 500
Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.
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The ETP securities are intended for sophisticated investors who (i) are able to monitor their investment in the ETP securities on a frequent basis in line with the recommended holding period; (ii) understand the risk of compounded returns and the increased risk of investment in leveraged products; (iii) can afford to risk losing their investment; and (iv) and have a very short investment horizon in line with the recommended holding period. Please ensure that you fully understand the risks involved. If in any doubt, please seek independent financial advice. Investors should refer to the section entitled “Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in the securities offered by the Issuer. This material is not intended to be relied upon as a forecast, research or investment advice and is not a recommendation, offer or solicitation to buy or sell any financial instrument or product or to adopt any investment strategy. Any decision to invest should be based on the information contained in the relevant base prospectus after seeking independent investment, tax and legal advice.
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Nothing on this website is advice on the merits of any product or investment, nothing constitutes investment, legal, tax or any other advice nor is it to be relied on in making an investment decision. Prospective investors should obtain independent investment advice and inform themselves as to applicable legal requirements, exchange control regulations and taxes in their jurisdiction.
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Terms and Conditions
Notice
If you are not classified as an institutional investor, you will be categorised as a private/retail investor. At this time, we cannot send communications directly to private/retail investors. You are welcome to view the contents of this website.
If you are an ‘Institutional investor’, you affirm either that you are a Per Se Professional Client, or that you wish to be treated as an Eligible Counterparty Client, both as defined under the Markets in Financial Instruments Directive, or an equivalent in a jurisdiction outside the European Economic Area.
Risk Warnings
The value of an investment in ETPs may go down as well as up and past performance is not a reliable indicator of future performance. Trading in ETPs may not be suitable for all types of investor as they carry a high degree of risk. You may lose all of your initial investment. Only speculate with money you can afford to lose. Changes in exchange rates may also cause your investment to go up or down in value. Tax laws may be subject to change. Please ensure that you fully understand the risks involved. If in any doubt, please seek independent financial advice. Investors should refer to the section entitled “Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in the securities offered by the Issuer.
This website is provided for your general information only and does not constitute investment advice or an offer to sell or the solicitation of an offer to buy any investment.
Nothing on this website is advice on the merits of any product or investment, nothing constitutes investment, legal, tax or any other advice nor is it to be relied on in making an investment decision. Prospective investors should obtain independent investment advice and inform themselves as to applicable legal requirements, exchange control regulations and taxes in their jurisdiction.
This website complies with the regulatory requirements of the United Kingdom. There may be laws in your country of nationality or residence or in the country from which you access this website which restrict the extent to which the website may be made available to you.
United States Visitors
The information provided on this site is not directed to any United States person or any person in the United States, any state thereof, or any of its territories or possessions.
Persons accessing this website in the European Economic Area
Access to this site is restricted to Non-U.S. Persons outside the United States within the meaning of Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”). Each person accessing this site, by so doing, acknowledges that: (1) it is not a U.S. person (within the meaning of Regulation S under the Securities Act) and is located outside the U.S. (within the meaning of Regulation S under the Securities Act); and (2) any securities described herein (A) have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction and (B) may not be offered, sold, pledged or otherwise transferred except to persons outside the U.S. in accordance with Regulation S under the Securities Act pursuant to the terms of such securities. None of the funds on this website are registered under the United States Investment Advisers Act of 1940, as amended (the “Advisers Act”).
Exclusion of Liability
Certain documents made available on the website have been prepared and issued by persons other than Leverage Shares Management Company. This includes any Prospectus document. Leverage Shares Management Company is not responsible in any way for the content of any such document. Except in those cases, the information on the website has been given in good faith and every effort has been made to ensure its accuracy. Nevertheless, Leverage Shares Management Company shall not be responsible for loss occasioned as a result of reliance placed on any part of the website and it makes no guarantee as to the accuracy of any information or content on the website. The description of any ETP Security referred to in this website is a general one. The terms and conditions applicable to investors will be set out in the Prospectus, available on the website and should be read prior to making any investment.
Leverage Investment
Leverage Shares exchange-traded products (ETPs) provide leveraged exposure and are only suitable for experienced investors with knowledge of the risks and potential benefits of leveraged investment strategies.
Cookies
Leverage Shares Management Company may collect data about your computer, including, where available, your IP address, operating system and browser type, for system administration and other similar purposes (click here for more information). These are statistical data about users’ browsing actions and patterns, and they do not identify any individual user of the website. This is achieved by the use of cookies. A cookie is a small file of letters and numbers that is put on your computer if you agree to accept it. By clicking ‘I agree’ below, you are consenting to the use of cookies as described here. These cookies allow you to be distinguished from other users of the website, which helps Leverage Shares Company provide you with a better experience when you browse the website and also allows the website to be improved from time to time. Please note that you can adjust your browser settings to delete or block cookies, but you may not be able to access parts of our website without them.
This website is maintained by Leverage Shares Management Company, which is a limited liability company and is incorporated in Ireland with registered offices at 2 Grand Canal Square, Grand Canal Harbour, Dublin 2.
By clicking you agree to the Terms and Conditions displayed.
