Defiance Daily Target 2x Long RCAT ETF (RCAX)

The Defiance Daily Target 2x Long RCAT ETF (RCAX) is an exchange-traded fund from Defiance ETFs that seeks daily investment results equal to two times (2x) the daily percentage change in the share price of Red Cat Holdings, Inc. (RCAT). It is a single-stock leveraged product rather than a diversified portfolio.

Red Cat Holdings develops drone technology, including small unmanned aircraft systems built for military, government and public safety reconnaissance missions. The fund typically obtains its exposure through swap agreements and other derivatives rather than simply holding the shares, and it rebalances its exposure every trading day.

Because the leverage target resets daily, the fund's returns over periods longer than one day can differ substantially from the stated multiple of the stock's return for the same period, particularly when the share price is volatile.