Understanding the Direxion Daily LMT Bear 1X ETF (LMTS)

The Direxion Daily LMT Bear 1X ETF (LMTS) is an inverse ETF. This means it is designed to move in the opposite direction of its target asset. Specifically, it seeks to provide a "bear" return, meaning the fund generally gains value when the price of its target asset falls and loses value when that asset rises.

What the Numbers Show

Based on the data as of October 5, 2026, the current share price of LMTS is $16.77. The fund has seen a decline in its share price over the last year.

• Price Return: This measures only the change in the share price. The one-year price return is -20.47%, and the year-to-date (YTD) price return is -22.98%.

• Total Return: This reflects the overall return, including distributions. The one-year total return is -18.97%, and the YTD total return is -22.38%.

• Estimated Price: The estimated price from roughly one year ago was $21.09.

Income and Distribution Explanation

LMTS provides some cash distributions to investors, but they are not frequent. In the last 12 months, the fund paid out distributions twice. The distribution yield is approximately 2.21%.

It is important for beginners to remember that a distribution yield is not the same as a total return. While the fund paid out some cash, the total return remained negative because the share price declined significantly.

Price and NAV Erosion Explanation

The supplied data is sufficient to evaluate price erosion, but it does not include enough historical NAV-per-share data to confirm or rule out NAV erosion.

Regarding price-based evidence, the fund has an erosion-risk score of 55, which is labeled as "Moderate price erosion." This means the fund's share price has shown a trend of deterioration. However, the "severe erosion-risk flag" is currently false.

Pros

• Inverse Strategy: It provides a way for investors to express a "bearish" view (expecting a price drop) on its target asset without needing to short a stock manually.

• Some Income: The fund does provide occasional cash distributions.

Cons

• Negative Returns: Both the one-year and YTD total returns are significantly negative.

• Price Erosion: The fund has a moderate price erosion-risk score.

• Inconsistent Income: Distributions are irregular and infrequent.

Beginner Takeaway

LMTS is an inverse tool, not a traditional "buy and hold" investment. The data shows that the share price has fallen over the past year, and the small amount of income from distributions was not enough to offset those losses. Investors should be aware that high or steady distributions do not guarantee that the original investment (the principal) is being preserved.