MicroSectors 3x Long Investment Grade Corporate Bond (LQD) ETNs (LQDU)

MicroSectors 3x Long Investment Grade Corporate Bond (LQD) ETNs are exchange-traded notes issued by the Bank of Montreal under the MicroSectors brand. They seek to provide three times (300%) the daily performance of the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD), a widely held fund of U.S. dollar investment-grade corporate bonds.

Because these are notes rather than a fund, holders do not own bonds or shares of LQD. The ETNs are senior unsecured debt obligations of the Bank of Montreal whose value is linked to the leveraged daily return, so they also carry the issuer's credit risk.

The 3x target resets every trading day. Over periods longer than a day, compounding can cause returns to diverge substantially from three times LQD's cumulative performance, so the notes are designed for short-term trading.