These 3 ETFs Are Suitable for Ultra-Bearish Investors

A realistic brown bear with an open mouth, angled slightly, standing in front of glowing digital screens displaying downward-trending stock market charts.

Key Points

The field of inverse leveraged ETFs is growing, and -3x funds are available with a range of strategies incorporating industry-specific themes down to single-stock approaches. Tech bears may find that WEBS, FNGD, and RGTZ provide negative leveraged exposure to different segments of the space. WEBS is the broadest of these, focusing on a group of around 40 internet companies, while RGTZ is the narrowest with -2x leveraged exposure to Rigetti Computing. Interested in Direxion Daily Dow Jones Internet Bear 3x Shares? Here are five stocks we like better.

There is no shortage of reasons for investors to be bearish in April 2026. From uncertainties surrounding the Iran war and the energy market to questions about the future of artificial intelligence and its implications for the workforce, those not pleased with the market's direction might want to find a way to benefit from their expectation that things could get worse.

Investors with a particularly strong conviction that a downturn is inevitable and an appetite for considerable risk may want to consider exchange-traded funds (ETFs) that leverage market bearishness for profit potential: bearish leveraged ETFs.

The following three funds range from exposure to broader industries to exposure to a single stock, allowing bearish investors to tailor the focus of their investments as much or as little as needed to match their expectations of the market.

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A Powerful Bet Against Leading Internet Companies

The Direxion Daily Dow Jones Internet Bear 3X Shares (NYSEARCA: WEBS) is a 3x inverse leveraged play on the Dow Jones Internet Composite Index.

The index focuses on companies deriving at least half of their sales from the internet and that have a three-month market capitalization average of at least $100 million.

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Despite the seemingly narrow focus of the index, it actually targets a fairly wide variety of tech and consumer firms, ranging from retailers like Amazon.com (NASDAQ: AMZN) to networking and hardware names like Arista Networks (NYSE: ANET) to streamers like Netflix Inc. (NASDAQ: NFLX) and more. In total, the index holds roughly 40 names.

The WEBS makes a strongly bearish bet on the index by constructing a leveraged play that aims for -3x daily performance. Thus, when the index declines over a single day of trading, WEBS surges by three times that amount. Conversely, though, WEBS magnifies its declines by the same factor on days in which the index rises.

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This makes the fund high-risk, like most leveraged ETFs, with its leverage resetting daily, which requires investors to maintain very active positions to avoid volatility decay. In exchange for that risk, the fund provides a dividend yield of 2.6% and the potential for major single-day growth, all for an expense ratio of 1.07%, which is fairly modest compared to some other highly leveraged ETFs.

A Narrower Focus for Inverse Leveraged Exposure to FANG+ Stocks

The FANG+ companies may have lost some of their hype, but they still account for an outsized share of the market and have a significant impact on the S&P 500's performance.

For those expecting a drop in this fairly narrow segment of the equities universe, the MicroSectors FANG+ Index -3X Inverse Leveraged ETN (NYSEARCA: FNGD) stands ready.

FNGD is another -3x leveraged tool to make powerful bets against a collection of stocks represented by the NYSE FANG+ Index.

The index is focused on 10 of the biggest tech names, including not only the FANG stocks themselves but also other leaders like NVIDIA (NASDAQ: NVDA) and Alibaba Group (NYSE: BABA).

Like the WEBS, the FNGD carries a high degree of risk and is designed for very active investors making short-term trades based on a conviction that the FANG+ group will experience a share price decline over a single trading period. The leverage also resets daily, making FNGD inappropriate for a long-term investment strategy. Its expense ratio is 0.95%, making it slightly less expensive than the other two leveraged ETFs on this list.

Ultra-Targeted Bearish Bets on Single Names

ETFs with a focus on a single name have proliferated in recent months, an indication that investors are seeking out opportunities to make strategic bets either for or against specific stocks. These funds provide amplified exposure to one stock at a time, making them the most targeted of the ETFs on our list, although they also carry fairly sizable risks due to their leverage.

The Defiance Daily Target 2X Short RGTI ETF (NASDAQ: RGTZ) gives quantum computing bears a chance to make a targeted bet against the performance of Rigetti Computing, Inc. (NASDAQ: RGTI). Rigetti is one of the leading pure-play quantum firms. But like many others in the industry, it has struggled in recent months, having lost almost 40% this year. While quantum firms struggle against slow adoption rates, a niche customer base, and a lack of profitability, further declines may be in store.

The targeted focus of a fund like RGTZ comes at a price. The expense ratio is 1.29%, and while high, that is fairly standard for single-stock ETFs. The fund is also only a few months old, having launched in October 2025, and has a small asset base of just $32 million as a result. For active traders seeking liquidity, this may present a concern.

The article "These 3 ETFs Are Suitable for Ultra-Bearish Investors" was originally published by MarketBeat.

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