Leveraged bond ETFs are exchange-traded funds that use financial derivatives, such as options and futures, to gain exposure to a leveraged or multiplied return on a bond index or bond sector. This means that the ETF aims to achieve a multiple of the return of a bond index or sector, typically 2x or 3x. For example, if the bond index or sector returns 2%, a 2x leveraged bond ETF would aim to return 4%. These types of ETFs can be helpful for investors looking for ways to magnify their returns on their bond investments, but they also carry a higher level of risk and may not be suitable for all investors.

It's important to note that leveraged ETFs are designed to achieve their stated leverage daily, not over a longer period. This means that the ETFs may not be suitable for long-term investment strategies, as the compounding effect of the daily leverage can cause the ETF to deviate significantly from its stated leverage over time.

Leveraged Bonds

Cboe US

GOOX

ProShares Ultra High Yield (UJB) is a leveraged ETF that seeks daily investment results, before fees and expenses, equal to 2x the daily performance of the Markit iBoxx $ Liquid High Yield Index, a benchmark of liquid U.S. dollar-denominated high yield corporate bonds. Due to daily reset and compounding, the fund is intended for short-term tactical use rather than long-term holding.

NYSEArca

The Fund seeks long-term capital appreciation by providing equal exposure to a U.S. bond strategy that captures the total return of the broad U.S. Treasury market and a merger arbitrage strategy that tracks the AlphaBeta Merger Arbitrage Index.

RSBA

The ETRACS Monthly Pay 2xLeveraged Preferred Stock ETN is an exchange-traded note issued by UBS that provides 2x leveraged long exposure to the compounded monthly performance of the Solactive Preferred Stock ETF Index, less financing costs and tracking fees. The index tracks an equally weighted portfolio of U.S. preferred stock ETFs, and the ETN may pay variable monthly coupons linked to leveraged cash distributions from the index constituents.

Symbol	Name	Sharpe Ratio (1Y)	Sharpe Ratio (5Y)	Sharpe Ratio (10Y)	Risk / Return Rank
GOOX	T-Rex 2X Long Alphabet Daily Target ETF	4.97	—	—	94
UJB	ProShares Ultra High Yield	1.08	0.20	0.36	34
RSBA	Return Stacked Bonds & Merger Arbitrage ETF	0.85	—	—	26
TYO	Direxion Daily 7-10 Year Treasury Bear 3X	0.38	0.55	0.09	15
PFFL	ETRACS Monthly Pay 2xLeveraged Preferred Stock ETN	0.33	-0.26	—	15

Top Leveraged Bonds ETFs by Sharpe Ratio

Top Leveraged Bonds ETFs by Sharpe Ratio