The Triple X Utilities Strategy
Lights On, Profits Up with Utilities Stocks
Investing in utilities stocks is a great way to gain stability and reliability, acting as a cornerstone for a diversified investment portfolio. Utilities companies—providing essential services like water, electricity, and gas—benefit from constant demand regardless of economic conditions. This results in predictable revenue and less volatility compared to other sectors.
Utilities stocks also serve as a hedge against inflation. As the cost of essential services rises with inflation, utilities companies can often pass these increased costs onto consumers, maintaining their revenue margins. This aspect makes utilities stocks attractive for long-term investment, offering growth potential with defensive characteristics that can protect against market downturns.
The Triple X Utilities Strategy for the Direxion Daily Utilities Bull 3X Shares (symbol UTSL) is a leveraged ETF that strategically uses technical indicators for market timing. It aims to triple the daily return of an index of utilities stocks. The strategy's approach to buying and selling is methodical:
Buy Side Indicator: Utilizes Turn of the Month Strategy
Sell Side Indicator: Employs the Aroon Indicator to signal the strength of the trend and potential turning points, optimizing entry and exit points.
The Triple X Utilities Strategy combines a month-end timing approach with the Aroon Indicator to capture market shifts and manage risk. It targets potential trend reversals at month's end for buys and uses the Aroon Indicator to detect weakening trends for timely sells, optimizing gains and minimizing losses with focused timing and trend analysis.
A Word About the Direxion Daily Utilities Bull 3X Shares (symbol UTSL)
The Direxion Daily Utilities Bull 3X Shares seeks daily investment results, before fees and expenses, of 300% of the performance of the Utilities Select Sector Index. There is no guarantee the fund will achieve its stated investment objective. This leveraged ETF seeks a return that is 300% of the return of its benchmark index for a single day. The fund should not be expected to provide three times the return of the benchmark’s cumulative return for periods greater than a day.
Index Information
The Utilities Select Sector Index (IXUTR) is provided by S&P Dow Jones Indices and includes domestic companies from the utilities sector which includes the following industries: electric utilities; multi-utilities; water utilities; independent power producers and energy trades; and gas utilities. One cannot invest directly in an index.