(SMCX) Defiance Daily Target 2X - Ratings and Ratios

The Defiance Daily Target 2X Long SMCI ETF (NASDAQ:SMCX) is an actively managed exchange-traded fund designed to deliver twice the daily percentage change of the underlying security, SMCI. It achieves this through the use of swap agreements, which are financial contracts that allow the fund to gain exposure to the performance of the underlying asset without directly holding it. The fund is classified as non-diversified, meaning it may concentrate its investments in a smaller number of securities, which can increase risk but also potentially amplify returns.

From a technical standpoint, SMCX is currently trading at $58.08, below its 20-day simple moving average (SMA) of $67.45 and its 50-day SMA of $52.86. However, it remains well below its 200-day SMA of $106.11, indicating a significant decline over the longer term. The Average True Range (ATR) of 11.90 suggests moderate volatility, with price swings of approximately 20% over a 20-day period. The average daily trading volume of 4,103,544 shares provides sufficient liquidity for most investors.

Fundamentally, SMCX manages assets under management (AUM) of $383.02 million, positioning it as a mid-sized ETF with adequate scale to maintain market impact while still being agile enough to adjust its positions as needed. The funds focus on delivering leveraged returns makes it a tool for sophisticated investors seeking to capitalize on short-term price movements in SMCI.

Over the next three months, based on the current technical and fundamental data, SMCX is expected to experience continued volatility. The gap between the 20-day SMA and the 200-day SMA suggests bearish momentum, with potential downside risks. However, if SMCI experiences a rebound, the funds 2x leverage could amplify gains. The ATR of 11.90 indicates that price fluctuations will likely remain significant, with potential swings of 15-20% in either direction. Investors should monitor the funds performance closely, as leveraged ETFs are designed for short-term trading and may not be suitable for long-term holding.