Direxion Small Cap Bull 3X Shares (TNA) Covered Calls

The Direxion Daily Small Cap Bull 3X ETF is a leveraged investment fund that seeks daily investment results, before fees and expenses, of 300% of the daily performance of the Russell 2000 Index. It is designed as a short-term tactical tool for sophisticated traders and does not aim to provide 3X the return of the index over periods longer than a single trading day.

You can sell covered calls on Direxion Small Cap Bull 3X Shares to lower risk and earn monthly income. Born To Sell's covered call screener gives you customized search capabilities across all possible covered calls but here are a couple of examples for TNA (prices last updated Thu 4:16 PM ET):

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The Direxion Daily Small Cap Bull 3X ETF (TNA) is a specialized investment vehicle that utilizes financial derivatives, such as swap agreements and futures contracts, to achieve its leverage objective. Unlike traditional ETFs that hold a basket of securities to track an index, TNA’s primary goal is to amplify the daily price movements of the Russell 2000 Index by a factor of three. Because the fund resets its leverage daily, the mathematical effect of compounding means that its performance over periods longer than one day can differ significantly from the cumulative return of the underlying index.

This fund is not intended for long-term "buy-and-hold" investors. Its design is targeted at active traders who wish to capitalize on short-term market trends within the U.S. small-cap equity space. It requires active monitoring, as the magnified daily volatility and the effects of daily rebalancing can lead to significant erosion of value in choppy or sideways markets.

Competitive Landscape

The leveraged ETF space is dominated by a few specialized issuers that provide various bull and bear exposures. Key peers include the ProShares Ultra Russell2000, which offers 2x daily leverage, and the Direxion Daily Small Cap Bear 3X ETF, which provides the inverse (or opposite) 3x daily exposure to the same index. Investors also look to broader leveraged products like the ProShares UltraPro Russell2000 as an alternative for 3x daily bullish exposure.

Strategic Outlook and Innovation

The strategy is explicitly short-term, focusing on tactical precision rather than long-term asset accumulation. The fund provides a mechanism for investors to gain highly aggressive exposure to small-cap sentiment without the need for managing individual derivative positions. Innovation is focused on the efficient use of swap and futures markets to maintain the target daily leverage ratio despite market volatility.

While the fund provides a powerful tool for short-term directional bets, it remains an instrument for sophisticated market participants who understand the specific mechanics of leveraged drift and volatility decay. Its role is primarily as a surgical instrument for expressing strong short-term bullish views on the small-cap market segment.

Want more examples? TMV Covered Calls | TNC Covered Calls