MicroSector ETN With All The Right Stocks – And It’s Leveraged!

We can thank one of the subscribers to my MEM Edge Report for today’s chart you don’t want to ignore! It’s for an Exchange Traded Note (ETN) that tracks 3x the daily movements of an index of U.S. listed technology and consumer discretionary companies with a ticker symbol FNGU.

We’re not talking about just any technology or consumer stocks but rather, FNGU offers 3x leverage to an index of FANG and other companies that exhibit similar characteristics. In other words, a basket of high quality growth stocks that have recently been under high demand.

DAILY CHART OF BMO REX MicroSectors FANG Index 3x Leveraged ETN

The basket includes 10 stocks that are equal weighted and in addition to Facebook (FB), Apple (AAPL), Amazon (AMZN), Netflix (NFLX) and Alphabet (GOOGL), there is also Alibaba (BABA), Nvidia (NVDA), Tesla (TSLA), Baidu (BIDU) and Twitter (TWTR).

Every stock on this list is a high-quality growth company that’s in a strong uptrend. Of course, investors need to keep in mind that this ETN is leveraged at 3 times so while you’ll enjoy extra returns when these stocks are rallying, you’ll experience more losses on the downside should the markets hit a speed bump.

While FNGU is bullishly poised to break out of a 1-month base, the ETN is approaching an overbought position and a more prudent buy point may be on a pullback closer to its 10-day moving average.

There are a number of other growth stocks on the move and if you’d like to be alerted to a select list of those poised to outperform, trial my top-performing MEM Edge Report by using this link here. You’ll be provided with precise buy and sell points twice a week as well as sector insights not found elsewhere.


Mary Ellen McGonagle, MEM Investment Research