In just 16 months, ProShares ETFs have gathered $9 billion in assets, outstripping the nine-year-old ProFunds' $8 billion in mutual fund assets and caused ripples through a market dominated by large players, such as Barclays, SSgA, and Vanguard.
In fact, with 88% of its products dedicated to inverse/enhanced products, ProShares is a leading example of a firm that continuously finds opportunities with popular market-timing appeal.
The timing of the UltraShort China Fund (FXP) is also superb, due to the fact that demand for inverse/enhanced products runs rampant and "hot investment themes" such as China may be due for a short-term market correction, following on 560 days of a rally.
The UltraShort China 25, as a market-timing instrument, is aimed at advisors and sophisticated investors seeking diversification benefits, derivatives-like leverage, and position hedging.
However, a large number of institutional investors are also finding the product appealing. While critics disparage enhanced ETF products as untested, risky and volatile, ProShares' products offer added flexibility and opportunities for market participants. With approximately $12 billion in AUM dedicated to inverse/enhanced products, the firm is clearly ahead of its competition in the inverse/enhanced ETF product space.