Leveraged Treasury ETF TMF lost 85% in 5 years, showing risks of daily-reset leverage funds.

The Direxion Daily 20+ Year Treasury Bull 3X Shares (TMF) ETF, designed to deliver triple the daily returns of long-term Treasuries, lost about 85% of its value over five years, turning a $10,000 investment into roughly $1,527. This steep loss reflects the impact of daily leverage resets and compounding effects, which erode value in volatile or sideways markets despite the fund performing as promised. TMF's structure makes it suitable only for very short-term trades, as holding it long-term can lead to significant losses even if the underlying Treasury bonds decline less. Investors seeking exposure to long Treasuries with lower risk and cost might prefer unleveraged ETFs like TLT or EDV, which avoid daily resets and have much smaller fees.