Reverse Splits in FAS and FAZ Could Decrease Overall Market Volume By 5%
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Themis Trading's Joe Saluzzi has some interesting comments on the reverse splits in the 3x bullish and bearish ETFs, Direxion Daily Financial Bull 3X Shares (NYSE: FAS) and Direxion Daily Financial Bear 3X Shares (NYSE: FAZ).
Joe suggests that the splits were done to draw attention away from their huge volume. FAZ has an average daily volume of about 247 million shares and FAS has an avearge daily volume of about 233 mililon shares.
Joe thinks that as a result of the reverse splits in the two, overall market volume today could decrease by half a billion (or about 5%).
Joe said, "I think a lot of people are becoming critical, or at least looking at the composition of the 'volume' in today's market place. FAZ and FAS are the triple long and short ETF's related to the financials. FAS just announced a reverse split of 1 for 5, and FAZ just announced a reverse split of 1 for 10. Why? Splits do not matter, right? Unless you don't want to draw attention to the volume..."
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