As disclosed last month, the reverse share splits of four of Direxion Shares Exchange Traded Fund Trust leveraged exchange-traded funds (ETFs) and forward share splits of five other leveraged ETFs will be in effect on Thursday for all respective shareholders as of Tuesday’s close.
Each shares will begin trading on a split-adjusted basis on Thursday. The total market value of the outstanding shares will not be affected by the said share splits unless in terms of fractional shares.
Reverse Share Splits
The 1-for-4 reverse split covers the Direxion Daily Natural Gas Related Bear 3X Shares (NYSEARCA:GASX), which will then have a 75% decrease in outstanding shares; and the 1-for-5 reverse splits respectively cover the Direxion Daily Gold Miners Index Bear 3X Shares (NYSEARCA:DUST), Direxion Daily Junior Gold Miners Index Bear 3X Shares (NYSEARCA:JDST), and Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 3X Shares (NYSEARCA:DRIP), each of which will then have an 80% decrease in outstanding shares. As a result of the reverse splits, the opening market price of each of the shares will increase four or five times on the next trading day.
Forward Share Splits
The 4-for-1 forward share splits cover the Direxion Daily 20+ Treasury Bull 3X Shares (NYSEARCA:TMF), Direxion Daily Brazil Bull 3X Shares (NYSEARCA:BRZU), and Direxion Daily Real Estate Bull 3X Shares (NYSEARCA:DRN), each of which will then have a 300% increase in outstanding shares; a 5-for-1 forward share split covers the Direxion Daily Gold Miners Index Bull 3X Shares (NYSEARCA:NUGT), which will then have a 400% increase in outstanding shares; and a 10-for-1 forward share split covers the Direxion Daily Junior Gold Miners Index Bull 3X Shares (NYSEARCA:JNUG), which will then have a 900% increase in outstanding shares.
Fractional Shares
Shareholders with fractional shares resulting from the share splits will be entitled to redeem the said shares in cash. No transaction fees are associated with the redemptions. However, tax implications are anticipated. Consequently, shareholders may incur either gains or losses from their respective redemptions.
