DFEN is the ticker for the Direxion Daily Aerospace & Defense Bull 3x Shares ETF, which closed at $23.01/share on 7/27/2021.
DFEN is a 3x levered ETF, which means it seeks the returns of 300% of the Dow Jones US Select Aerospace & Defense Index.
It is important to note that the 300% anticipated returns on that index are for a single day, and not for longer-term periods.
DFEN Stock Price:$23.01
10 Day Moving-Average: $22.11
50 Day Moving-Average: $24.08
200 Day Moving-Average: $19.11
RSI: 48
The DFEN ETF has been rebounding after a dip in early July, completing a bullish MACD crossover yesterday.
With an RSI of 48 this looks like the trend is on pace to continue higher, as the price finds itself near halfway between the 10 Day & 50 Day Moving-Averages.
Before purchasing DFEN or any other ETF (especially leveraged ones), always review the holdings in the prospectus to ensure that you have an understanding of what is going to be impacting the price.
In the case of DFEN, the top ten holdings in the ETF are: Boeing, Raytheon Technologies, Lockheed Martin, Teledyne Tech, L3 Harris Technologies, General Dynamics, Northrop Grumman, Transdigm Group, Textron & Howmet Aerospace (by %).
One interesting thing to note is that by sector the ETF is constructed of 97.7% Aerospace & Defense names, while also having 1.4% Machinery & ~1% Leisure Products components, which will impact performance on a given day.
DFEN is an interesting play for short-term oriented traders, especially those that want to get exposure to the Aerospace & Defense sector.
As a longer-term hold, it would be wiser to examine the basket of stocks that they own, and choose the best among them on an individual basis, so that you reduce the risks associated with owning a leveraged large basket of individual stocks.
I’m looking at the $24 call options with the 8/20 expiration date, and the same puts as well.
Overall, DFEN offers traders a great way to take advantage of short-term advances in the aerospace & defense sector and is worth considering adding to your portfolio.
*** I DO NOT OWN SHARES OF DFEN STOCK/ETF ***