On February 13, Defiance ETFs introduced the Battleshares TSLA vs F ETF, marking the inaugural release in a series pairing optimistic investments in forward-thinking companies with pessimistic positions in their conventional industry rivals.
The novel ETF combines an aggressive long position in electric vehicle maker Tesla, offering investors twice the stock's potential growth, along with a commitment that secures a full return for investors on any decrease in Ford's shares.
While investors have been able to leverage single-stock ETFs to speculate on the performance of individual companies like Nvidia and Tesla, this marks the first attempt to merge two distinct stocks and directional wagers within a single investment vehicle.
Defiance CEO Sylvia Jablonski explained that these "pairs trades" have long been utilized by professional traders and institutions but were previously unavailable in an ETF format. Defiance, which already offers a range of leveraged single-stock ETFs, plans to introduce a series of Battleshares ETFs, each combining a bullish amplified bet on a "new leader" like Tesla with a bearish stance on the established company, such as pairing Nvidia with Intel, Coinbase with Wells Fargo & Co, and Amazon with Macy's.
Jablonski hinted at a forthcoming ETF launch as early as next week contingent on investor interest in the Tesla versus Ford arrangement. She noted, "Tesla and Elon Musk are receiving considerable attention currently, making this a prime opportunity to explore the idea of investors engaging in a competition between an established firm and an innovator."
The ETF carries a substantial 1.29% fee, significantly surpassing the Morningstar-calculated average of 0.45%.