The Triple X Financials Strategy
Banking on the Boom: A Growth Strategy for the Financial Sector
The US financial services sector anchors the world's largest economy and offers investors a compelling chance for potential growth and income. It encompasses banks, insurance companies, asset management firms, as well as a diverse array of other financial services providers fulfilling a crucial role in the flow of capital and economic activity.
Here's why investing in the US financial services sector can be a smart strategic play:
Key benefits of the US financial services sector:
A Driver of Economic Growth: The health of the financial sector mirrors the underlying growth of the broader economy. As the economy expands, businesses and consumers take on loans and investments, and seek a range of other financial services, and this expansion provides the fuel for sector-wide growth.
An Innovation and Adaptability Hub: The financial services sector in the US is widely recognized for its ability to innovate and adapt to changing market needs. This forward-thinking approach underpins the sector's resilience and the considerable scope for future growth.
The Triple X Financial Strategy is designed to capitalize on the unique advantages of leveraged ETFs. Specifically, the strategy is tailored for the Direxion Daily Financial Bull 3x Shares ETF (symbol FAS). The strategy could allow investors to take advantage of the capital appreciation opportunities in the financial sector, while seeking to manage potential downside risk. The Strategy utilizes the following buy and sell signals:
Buy signal: Flare-Out Growth Ratio to identify potential overheating in the market. May indicate a potential time to buy before market rallies.
Sell signal: Stochastic Indicator to identify potential overbought conditions and time to sell positions before significant downturn.
This combination is effective because it uses the Flare-Out Growth Ratio to identify early signs of a market rally, suggesting a good time to buy, and the Stochastic Indicator to pinpoint overbought conditions, indicating when to sell. It balances market entry and exit strategies, capturing potential profits from both market upturns and downturns.
A Word About the Direxion Daily Financial Bull 3x Shares ETF (symbol FAS)
The Direxion Daily Financial Bull Shares seek daily investment results, before fees and expenses, of 300% of the performance of the Financial Select Sector Index. There is no guarantee the funds will achieve their stated investment objective. These leveraged ETFs seek a return that are 300% of the return of their benchmark index for a single day. The funds should not be expected to provide three times or negative three times the return of the benchmark’s cumulative return for periods greater than a day.
Index Information
The Financial Select Sector Index (IXMTR) is provided by S&P Dow Jones Indices and includes securities of companies from the following industries: Banks; Thrifts & Mortgage Finance; Diversified Financial Services; Consumer Finance; Capital Markets; Insurance; and Mortgage Real Estate Investment Trusts (REITs). One cannot invest directly in an index.