Direxion Daily Financial Bull 3x ETF

FAS

Market cap $2.52B

In theory, the financial services sector, the second-largest sector exposure in the S&P 500, should be a decent performer this year. The reality is something else, as the largest pure beta ETF addressing the sector is down 4.6% year-to-date as of June 8.

Another earnings season means traders will be treated to a slew of updates from the financial services sector. In fact, some of have already arrived, suggesting that bank ETFs may be worth a look.

Q1 earnings reports have come in from four prominent names in the financial sector—Goldman Sachs, JP Morgan Chase, Wells Fargo, and Citigroup.

FAS aims to triple the daily returns of the S&P Financial Select Sector Index. But it's a leveraged ETF that resets daily and charges high fees.

The first month of 2026 is already in the books. Which sector walked away with the top spot when it came to total returns?

When financial stocks rally, a 3x leveraged ETF can deliver outsized gains. When they stumble, losses compound just as fast.

While the market's attention has largely concentrated on major headlines such as the blistering technology ecosystem, the Federal Reserve's shifting stance on monetary policy deserves careful consideration. Last month, the central bank cut its benchmark interest rate by 25 basis points, thus delivering a widely expected move that ended a nine-month policy pause.

Direxion Daily Financial Bull 3X Shares ETF (FAS) is rated a Sell due to six major risks facing financial stocks and the economy. FAS's +3x leverage amplifies downside risk, making it especially vulnerable amid recession, inflation, interest rate, bond, housing, and commercial real estate threats. Technical analysis shows FAS underperforming the S&P 500, with negative momentum and flat price action, signaling caution for leveraged exposure.

The call option spread strategy is an excellent way to take advantage of the bullish move in this ETF.

If the CME FedWatch Tool is correct, then there's a 90% chance the U.S. Federal Reserve institutes a rate cut of 25 basis points. It should result in positive moves for a market that's been expecting rate cuts all year, but four sectors in particular should benefit from easing monetary policy.