Analysis-US leveraged single-stock ETF boom may be cooling

Some are not deterred by the challenges of trying to break into the leveraged ETF market. So far this year, **Corgi Invest**, a Silicon Valley startup, has launched **127 new leveraged or inverse single-stock products** and has plans for more. Its founder, Emily Yuan, said in an interview that the firm will not launch these products only to rapidly shutter them. While Corgi's products have so far pulled in an average of **$1 million in assets**, Yuan says the firm's lower fees will win business from rivals. "If you make good products, the money will come," she said. While mainstream ETFs, made up of baskets of stocks rather than exposure to a single one, continue to pull in assets and the leveraged market segment boasts behemoths like the **$3.9 billion GraniteShares 2x Long NVDA Daily ETF NVDL.O**, these are the exception. The size of the average leveraged ETF, each of which aims to deliver a multiple of the underlying stock's return in a single trading session, has tumbled from **$272.2 million** at the end of 2024 to **$63.3 million** currently, according to data from Morningstar Direct. Half have less than **$7 million**. Consolidation is already underway. So far in 2026, Morningstar said **63 leveraged single-stock funds** have closed their doors in the U.S., compared to just **three in 2025**. Their ranks include products from Tradr ETFs tied to software firms **MongoDB MDB.O** and **Datadog DDOG.O**, hard hit earlier this year by a big selloff amid fears that AI would wreak havoc on their business models. One closure highlighted the risks associated with leveraged products. GraniteShares liquidated a **2x leveraged ETF tied to shares of Lucid Group LCID.O** after the electric vehicle manufacturer saw its shares plunge some **51% in a single day on July 14**. Such a move in an asset underpinning a 2x fund brings the latter's net asset value to zero. Red-hot demand for high-risk leveraged and inverse single-stock ETFs may be starting to cool. The increasingly volatile bull market has fueled investor interest in finding ways to double the hoped-for gains in the market's most popular and volatile stocks. As these speculative plays have multiplied — accounting for as much as half of all new launches in June alone — market analysts are questioning the trend's durability. "The market for these is saturated and there's only so much money out there chasing this kind of product," said Morningstar analyst Daniel Sotiroff. "A few firms at the top end up commanding the lion's share of the money, and then there's a long tail of also-rans who are struggling to attract assets." A rule of thumb in the ETF industry is that to survive and thrive, according to analysts like Sotiroff and Cerulli Associates, a new fund needs to attract between $50 million and $100 million in assets over the first year or two of its life. Below that threshold, it gets tougher for backers to cover their costs. Morningstar says **63 US leveraged single-stock funds** shut in 2026 versus **three in 2025**. The average leveraged ETF assets have fallen to **$63.3 million** from **$272.2 million** at the end of 2024. Morningstar Direct data shows **half of 474 leveraged ETFs** hold less than **$7 million** in assets.

Analysis-US leveraged single-stock ETF boom may be cooling

New entrants still see opportunity

Closures and liquidations are increasing

Second-wave launches target smaller names

Signs of cooling in leveraged single-stock ETFs

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