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Summary Prospectus
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June 29, 2012
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Direxion Shares ETF Trust
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Fixed Income Funds
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Direxion Daily 20+ Year Treasury Bull 3X Shares:
TMF
Hosted on NYSE Arca
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Before you invest, you may want to review the funds prospectus, which
contains more information about the fund and its risks. You can find the funds prospectus and other information about the fund, including the funds statement of additional information and shareholder report, online at
http://direxionshares.com/document/regulatory_documents.html. You can also get this information at no cost by calling 1-866-476-7523 or by sending an e-mail request to info@direxionshares.com, or from your financial intermediary. The funds
prospectus and statement of additional information, both dated June 29, 2012, are incorporated by reference into this Summary Prospectus.
Important Information Regarding the Fund
The
Direxion Daily 20+ Year Treasury Bull 3X Shares (formerly known as the Direxion Daily 30-Year Treasury Bull 3X Shares) (Fund) seeks
daily
leveraged investment results. The pursuit of daily leveraged goals means that the
Fund is riskier than alternatives that do not use leverage because the Funds objective is to magnify the performance of the Index. The pursuit of daily leveraged investment goals means that the return of the Fund for a period longer than a
full trading day may bear no resemblance to 300% of the return of the Index for such longer period because the aggregate return of the Fund is the product of the series of daily leveraged returns for each trading day. The path of the benchmark
during the longer period may be at least as important to the Funds return for the longer period as the cumulative return of the benchmark for the relevant longer period, especially in periods of market volatility. Further, the return for
investors that invest for periods less than a full trading day or for a period different than a trading day will not be the product of the return of the Funds stated goal and the performance of the target index for the full trading day.
Investment Objective
The Fund seeks daily investment results, before fees and expenses, of 300% of the performance of the NYSE 20 Year Plus Treasury Bond Index.
The Fund seeks
daily
leveraged investment
results and does not seek to achieve its stated investment objective over a period of time greater than one day.
The Fund is different and much riskier than most exchange-traded funds.
The Fund is designed to be utilized only by knowledgeable investors who understand the potential consequences of seeking daily leveraged
investment results, understand the risks associated with the use of leverage and are willing to monitor their portfolios frequently. The Fund seeks daily leveraged investment results relative to the Index and is different and riskier than similarly
benchmarked exchange-traded funds that do not use leverage. Therefore, the Fund is not intended to be used by, and is not appropriate for, investors who do not intend to actively monitor and manage their portfolios.
Fees and Expenses of the Fund
This table describes the fees and expenses that you may pay if you buy or hold shares of the Fund (Shares). Investors purchasing shares in the secondary market may pay costs (including customary
brokerage commissions) charged by their broker.
Annual Fund Operating Expenses
(1)
(expenses that you pay each year as a percentage of the value of your
investment)
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Management Fees
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0.75%
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Distribution and/or Service (12b-1) Fees
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0.00%
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Other Expenses of the Fund
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0.39%
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Acquired Fund Fees and Expenses
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0.15%
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Total Annual Fund Operating Expenses
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1.29%
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Expense Cap/Reimbursement
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0.19%
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Total Annual Fund Operating Expenses After Expense Cap/Reimbursement
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1.10%
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(1)
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The Funds adviser, Rafferty Asset Management, LLC (Rafferty or the Adviser) has contractually agreed to cap all or a portion of its
management fee and/or reimburse the Fund for Other Expenses through March 1, 2014, to the extent that the Funds Total Annual Operating Expenses exceed 0.95% (excluding, as applicable, among other expenses, taxes, leverage interest,
Acquired Fund Fees and Expenses, dividends or interest on short positions, other interest expenses, brokerage commissions, expenses incurred in connection with any merger or reorganization and extraordinary expenses such as litigation). Any expense
cap is subject to reimbursement by the Fund only within the following three years if overall expenses fall below these percentage limitations. This agreement may be terminated or revised at any time with the consent of the Board of Trustees.
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Expense Example.
This example is intended to help you compare the cost of investing in the Fund with the cost of investing in
other mutual funds. The example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year and
that the Funds operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
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1 Year
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3 Years
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5 Years
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10 Years
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$112
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$390
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$689
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$1,540
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Portfolio Turnover.
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns
over its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in Annual Fund Operating Expenses
or in the example, affect the Funds performance. During the most recent fiscal year, the Funds portfolio turnover rate was 128% of the average value of its portfolio. However, this portfolio turnover rate is calculated without regard to
cash instruments or derivative transactions. If the Funds extensive use of derivatives was
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Summary Prospectus
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1 of 6
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Direxion Daily 20+ Year Treasury Bull 3X Shares
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reflected, the Funds portfolio turnover rate would be significantly higher.
Principal Investment Strategies
The Fund, under normal circumstances, creates long positions by investing at least 80% of its net assets in U.S. government securities that comprise the NYSE 20 Year Plus Treasury Bond Index (Index)
and/or financial instruments that provide leveraged and unleveraged exposure to the Index. These financial instruments include: futures contracts; options on securities, indices and futures contracts; equity caps, collars and floors; swap
agreements; forward contracts; short positions; reverse repurchase agreements; exchange-traded funds (ETFs); and other financial instruments. On a day-to-day basis, the Fund also may hold short-term debt instruments that have
terms-to-maturity of less than 397 days and exhibit high quality credit profiles, including U.S. government securities and repurchase agreements.
The Index is a multi-security index that includes all qualified U.S. Treasury bonds. Bonds eligible for inclusion must be: U.S. Treasury Bonds; bullet or callable issues with fixed coupon payments; denominated in
U.S. dollars; and have a maturity of 20 or more years at issuance. The Index rebalances monthly, after the close of trading on the last business day of each month, with coupons re-invested in the index. The weighting of the bonds in each index is
reset during the rebalance to represent the market value of each issue.
The Fund may gain exposure to only a representative sample of
the securities in the Index that have aggregate characteristics similar to those of the Index. The Fund gains this exposure either by directly investing in the underlying securities of the Index or by investing in derivatives that provide exposure
to those securities. The Fund seeks to remain fully invested at all times consistent with its stated goal. At the close of the markets each trading day, Rafferty positions the Funds portfolio so that its exposure to the Index is consistent
with the Funds investment objective. The impact of the Indexs movements during the day will affect whether the Funds portfolio needs to be re-positioned. For example, if the Index has risen on a given day, net assets of the Fund
should rise, meaning that the Funds exposure will need to be increased. Conversely, if the Index has fallen on a given day, net assets of the Fund should fall, meaning the Funds exposure will need to be reduced. This re-positioning
strategy typically results in high portfolio turnover.
Because of daily rebalancing and the compounding of each days return over
time, the return of the Fund for periods longer than a single day will be the result of each days returns compounded over the period, which will very likely differ from 300% of the return of the Index over the same period. The Fund will lose
money if the Index performance is flat over time, and as a result of daily rebalancing, the Indexs volatility and the effects of compounding, it is even possible that the Fund will lose money over time while the Indexs performance
increases.
Additionally, because a significant portion of the assets of the Fund may come from investors using asset
allocation and market timing investment strategies, the Fund may further need to engage in frequent trading. The Fund will concentrate its investment in a particular industry or group of industries to approximately the same extent
as the Index is so concentrated.
Principal Risks
An investment in the Fund entails risk. The Fund could lose money or its performance could trail that of other investment alternatives. The Adviser cannot guarantee that the Fund will achieve its objective. In
addition, the Fund presents some risks not traditionally associated with most mutual funds and exchange-traded funds. It is important that investors closely review all of the risks listed below and understand how these risks interrelate before
making an investment in the Fund. Turbulence in financial markets and reduced liquidity in equity, credit and fixed income markets could negatively affect issuers worldwide, including the Fund. There is the risk that you could lose all or a portion
of your money invested in the Fund.
Adverse Market Conditions Risk
Because the Fund magnifies the performance of the
Index, its performance will suffer during conditions in which the Index declines.
Advisers Investment Strategy Risk
The Adviser utilizes a quantitative methodology to select investments for the Fund. Although this methodology is designed to correlate the Funds performance with the performance of the Index, there is no assurance that such methodology will be
successful and will enable the Fund to achieve its investment objective.
Counterparty Risk
The Fund may invest in
financial instruments involving counterparties for the purpose of attempting to gain exposure to a particular group of securities or asset class without actually purchasing those securities or investments, or to hedge a position. These financial
instruments may include swap agreements. The use of swap agreements and other counterparty instruments involves risks that are different from those associated with ordinary portfolio securities transactions. For example, the Fund bears the risk of
loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a swap agreement counterparty. Swap agreements and other counterparty instruments also may be considered to be illiquid. In addition, the
Fund may enter into swap agreements that involve a limited number of counterparties, which may increase the Funds exposure to counterparty credit risk. The Fund does not specifically limit its counterparty risk with respect to any single
counterparty. Further, there is a risk that no suitable counterparties will be willing to enter into, or continue to enter into, transactions with the Fund and, as a result, the Fund may not be able to achieve its investment objective.
Credit Risk
The Fund could lose money if the issuer or guarantor of a debt security goes bankrupt or is unable or unwilling to make
interest payments and/or repay principal. Changes in an issuers financial strength or in an issuers or debt securitys credit rating also may affect a securitys value and thus have an impact on Fund performance.
Daily Correlation Risk
There is no guarantee that the Fund will achieve a high degree of correlation to the Index and therefore
achieve its daily investment objective. To achieve a high degree of correlation with the Index, the Fund seeks to rebalance its portfolio daily to keep leverage consistent with its daily target. The Fund may have difficulty achieving its daily
target due to fees and expenses, high portfolio turnover, transaction costs and costs associated with the use of leveraged investment techniques and/or a temporary lack of liquidity in the markets for the securities held by the Fund. Market
disruptions, regulatory restrictions or extreme volatility will also adversely affect the Funds ability to adjust exposure to the required levels. The Fund may not have investment exposure to all securities in its underlying Index, or its
weighting of investment exposure to such stocks or industries may be different from that of the Index. In addition, the Fund may invest in securities or financial instruments not included in the underlying Index. The Fund may be subject to large
movements of assets into and out of the Fund, potentially resulting in the Fund being over- or under-exposed to its Index. In addition, the target amount of portfolio exposure to the Index is impacted
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Summary Prospectus
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2 of 6
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Direxion Daily 20+ Year Treasury Bull 3X Shares
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dynamically by the Indexs movement. Because of this, it is unlikely that the Fund will be perfectly exposed to the Index at the end of each day. The possibility of the Fund being materially
over- or under-exposed to its Index increases on days when the Index is volatile near the close of the trading day. Activities surrounding annual index reconstitutions and other index rebalancing or reconstitution events may hinder the Funds
ability to meet its daily investment objective on that day.
Debt Instrument Risk
The Fund may invest in, or seek exposure
to, debt instruments. Debt instruments may have varying levels of sensitivity to changes in interest rates, credit risk and other factors. Many types of debt instruments are subject to prepayment risk, which is the risk that the issuer of the
security will repay principal prior to the maturity date. In addition, changes in the credit quality of the issuer of a debt instrument can also affect the price of a debt instrument, as can an issuers default on its payment obligations. Such
factors may cause the value of an investment in the Fund to decrease.
Derivatives Risk
The Fund uses investment
techniques, including investments in derivatives such as futures and forward contracts, options and swaps, which may be considered aggressive. Investments in such derivatives are subject to market risks that may cause their prices to fluctuate over
time and may increase the volatility of the Fund. The use of derivatives may expose the Fund to additional risks that it would not be subject to if it invested directly in the securities underlying those derivatives, such as counterparty risk and
the risk that the derivatives may become illiquid. The use of derivatives may result in larger losses or smaller gains than otherwise would be the case. Additionally, with respect to the use of swap agreements, if the Index has a dramatic intraday
move in value that causes a material decline in the Funds NAV, the terms of the swap agreement between the Fund and its counterparty may allow the counterparty to immediately close out of the transaction with the Fund. In such circumstances,
the Fund may be unable to enter into another swap agreement or invest in other derivatives to achieve the desire exposure consistent with the Funds daily investment objective. This may prevent the Fund from achieving its daily investment
objective particularly if the Index reverses all or a portion of its intraday move by the end of the day. In addition, the Funds investments in derivatives currently are subject to the following risks:
Futures and Forward Contracts
. There may be an imperfect correlation between the changes in market value of the securities
held by the Fund and the prices of futures contracts. There may not be a liquid secondary market for the futures contracts. Forward currency transactions include the risks associated with fluctuations in currency.
Hedging Risk
. If the Fund uses a hedging instrument at the wrong time or judges the market conditions incorrectly, the hedge
might be unsuccessful, reduce the Funds investment return, or create a loss.
Options
. There may be an
imperfect correlation between the prices of options and movements in the price of the securities (or indices) hedged or used for cover which may cause a given hedge not to achieve its objective.
Swap Agreements
. Interest rate swaps are subject to interest rate and credit risk. Total return swaps are subject to
counterparty risk, which relates to credit risk of the counterparty and liquidity risk of the swaps themselves.
Early Close/Trading
Halt Risk
An exchange or market may close or issue trading halts on specific securities, or the ability to buy or sell certain securities or financial instruments may be restricted, which may result in the Fund being unable to buy or sell
certain securities or financial instruments. In such circumstances, the Fund may be unable to rebalance its portfolio, may be unable to accurately price its investments and/or may incur substantial trading losses.
Effects of Compounding and Market Volatility Risk
The Fund does not attempt to, and should not be expected to, provide returns which
are a multiple of the return of the Index for periods other than a single day. The Fund rebalances its portfolio on a daily basis, increasing exposure in response to that days gains or reducing exposure in response to that days losses.
This means that for a period longer than one day, the pursuit of daily goals may result in daily leveraged compounding. It also means that the return of an index over a period of time greater than one day multiplied by the Funds daily target
(300%) generally will not equal the Funds performance over that same period.
As a result, over time, the cumulative
percentage increase or decrease in the value of the Funds portfolio may diverge significantly from the cumulative percentage increase or decrease in the multiple of the return of the Funds underlying index due to the compounding effect
of losses and gains on the returns of the Fund. It also is expected that the Funds use of leverage will cause the Fund to underperform the return of three times its benchmark in a trendless or flat market.
The effect of compounding becomes more pronounced on the Funds performance as the Index experiences volatility. The Indexs volatility
rate is a statistical measure of the magnitude of fluctuations in the returns of the Index. The table below provides examples of how Index volatility could affect the Funds performance. The chart shows estimated Fund returns for a number of
combinations of performance and volatility over a one-year period and is shown to illustrate how holding the Fund for a period longer than one day may negatively impact investment return. As shown below, this Fund, or any other 3X Bull Fund,
would be expected to lose 17.1% (as shown in Table 1 below) if its Index provided no return over a one year period during which the Index experienced annualized volatility of 25%. If the Indexs annualized volatility were to rise to 75%, the
hypothetical loss for a one year period for the Fund widens to approximately 81.5%.
At higher ranges of volatility, there is a chance of
a near complete loss of value even if the Index is flat. For instance, if the Indexs annualized volatility is 100%, the Fund would be expected to lose 95% of its value, even if the cumulative Index return for the year was only 0%.
Table 1
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One
Year
Index
Return
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300%
One Year
Index
Return
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Volatility Rate
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10%
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25%
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50%
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75%
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100%
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60%
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180%
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93.8%
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94.7%
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97.0%
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98.8%
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99.7%
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50%
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150%
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87.9%
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89.6%
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94.1%
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97.7%
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99.4%
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40%
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120%
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79.0%
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82.1%
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89.8%
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96.0%
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98.9%
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30%
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90%
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66.7%
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71.6%
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83.8%
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93.7%
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98.3%
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20%
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60%
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50.3%
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57.6%
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75.8%
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90.5%
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97.5%
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10%
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30%
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29.3%
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39.6%
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65.6%
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86.5%
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96.4%
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0%
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0%
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3.0%
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17.1%
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52.8%
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81.5%
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95.0%
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10%
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30%
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29.2%
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10.3%
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37.1%
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75.4%
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93.4%
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20%
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60%
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67.7%
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43.3%
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18.4%
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68.0%
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91.4%
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30%
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90%
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113.2%
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82.1%
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3.8%
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59.4%
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89.1%
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40%
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120%
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166.3%
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127.5%
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29.6%
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49.2%
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86.3%
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50%
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150%
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227.5%
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179.8%
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59.4%
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37.6%
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83.2%
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60%
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180%
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297.5%
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239.6%
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93.5%
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24.2%
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79.6%
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Summary Prospectus
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3 of 6
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Direxion Daily 20+ Year Treasury Bull 3X Shares
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The Indexs annualized historical volatility rate for the five-year period ended December 30, 2011 is
17.40%. The Indexs highest volatility rate for any one calendar year during the five-year period is 19.69% and volatility for a shorter period of time may have been substantially higher. The Indexs annualized performance for the
five-year period ended December 30, 2011 is 11.11%. Historical Index volatility and performance are not indications of what the Index volatility and performance will be in the future.
For additional graphs and charts demonstrating the effects of volatility and index performance on the long-term performance of the Fund, see
Additional Information Regarding Investment Techniques and Policies and Negative Implications of Daily Goals in Volatile Markets in the Funds statutory prospectus, and Special Note Regarding the Correlation Risks
of the Funds in the Funds Statement of Additional Information.
Holding an unmanaged position opens the investor to the
risk of market volatility adversely affecting the performance of the investment. The Fund is not appropriate for investors who do not intend to actively monitor and manage their portfolios. This table is intended to underscore the fact that the Fund
is designed as a short-term trading vehicle for investors who intend to actively monitor and manage their portfolios.
To fully
understand the risks of market volatility on the Fund, see Negative Implications of Daily Goals in Volatile Markets found in the statutory prospectus.
Gain Limitation Risk
If the Funds benchmark moves more than 33% on a given trading day in a direction adverse to the Fund, you would lose all of your money. Rafferty will attempt to position the
Funds portfolio to ensure that the Fund does not lose more than 90% of its net asset value on a given day. The cost of such downside protection will be limitations on the Funds gains. As a consequence, the Funds portfolio may not
be responsive to Index gains beyond 30% in a given day. For example, if the Index were to gain 35%, the Fund might be limited to a daily gain of 90% rather than 105%, which is 300% of the Index gain of 35%.
High Portfolio Turnover Risk
Daily rebalancing of the Funds holdings pursuant to its daily investment objective causes a much
greater number of portfolio transactions when compared to most exchange-traded funds. Such frequent and active trading leads to significantly higher transaction costs because of increased broker commissions resulting from such transactions. In
addition, there is the possibility of significantly increased capital gains, including short-term and/or long-term capital gains that will be taxable to shareholders as ordinary income. The portfolio turnover rate stated in this prospectus is
calculated without including the short term cash instruments or derivative transactions that comprise the majority of the Funds trading. As such, if the Funds extensive use of derivative instruments was reflected, the stated portfolio
turnover rate would be significantly higher.
Interest Rate Risk
The value of the Funds investments in fixed income
securities and securities that provide exposure to fixed income securities will fall when interest rates rise. Because the Fund invests in long-term bonds, the effect of increasing interest rates may be more pronounced than investment in
intermediate-term or short-term bonds.
Intra-Day Investment Risk
The Fund seeks leveraged investment results from the
close of the market on a given trading day until the close of the market on the subsequent trading day. The exact exposure of an investment in the Fund intraday in the secondary market is a function of the difference between the value of the Index
at the market close on the first trading day and the value of the Index at the time of purchase. If the Index gains value, the Funds net assets will rise by the same amount as the Funds exposure. Conversely, if the Index declines, the
Funds net assets will decline by the same amount as the Funds exposure. Since a Fund starts each trading day with exposure which is 300% of its net assets, a change in both the exposure and the net assets of the Fund by the same absolute
amount results in a change in the comparative relationship of the two. As an example (using simplified numbers), if the Fund had $100 in net assets at the market close, it would seek $300 of exposure to the next trading days Index performance.
If the Index rose by 1% by noon the following trading day, the exposure of the Fund will have risen by 1% to $303 and the net assets will have risen by that $3 gain to $103. With net assets of $103 and exposure of $303, a purchaser at that point
would be receiving 294% exposure of her investment instead of 300%.
Leverage Risk
If you invest in the Fund, you are
exposed to the risk that a decline in the daily performance of the Index will be leveraged. This means that your investment in the Fund will be reduced by an amount equal to 3% for every 1% daily decline, not including the cost of financing the
portfolio and the impact of operating expenses, which would further lower your investment. The Fund could theoretically lose an amount greater than its net assets in the event of an Index decline of more than 33%. Further, purchasing shares during a
day may result in greater than 300% exposure to the performance of the Index if the Index declines between the close of the markets on one trading day and before the close of the markets on the next trading day.
To fully understand the risks of using leverage in the Fund, see Effects of Compounding and Market Volatility Risk above.
Liquidity Risk
Some securities held by the Fund, including derivatives, may be difficult to sell or illiquid, particularly during
times of market turmoil. Illiquid securities also may be difficult to value. If the Fund is forced to sell an illiquid security at an unfavorable time or at a price that is lower than Raffertys judgment of the securitys true market
value, the Fund may be forced to sell the security at a loss. Such a situation may prevent the Fund from limiting losses, realizing gains or achieving a high correlation with the Index.
Market Risk
The Fund is subject to market risks that can affect the value of its shares. These risks include political, regulatory,
market and economic developments, including developments that impact specific economic sectors, industries or segments of the market.
Non-Diversification Risk
The Fund is non-diversified, which means it invests a high percentage of its assets in a limited number of
securities. A non-diversified funds net asset values and total returns may fluctuate more or fall greater in times of weaker markets than a conventional diversified fund.
Regulatory Risk
The Fund is subject to the risk that a change in U.S. law and related regulations will impact the way the Fund operates, increase the particular costs of the Funds operations
and/or change the competitive landscape.
Risks of Investing in Other Investment Companies (including ETFs)
Investments in
the securities of other investment companies, including ETFs, may involve duplication of advisory fees and certain other expenses. Fund shareholders indirectly bear the Funds proportionate share of the fees and expenses indirectly paid by
shareholders of the other investment company or ETF, in addition to the fees and expenses Fund shareholders bear in connection with the Funds own operations. If the investment company or ETF fails to achieve its investment objective, the value
of the Funds investment will decline,
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Summary Prospectus
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4 of 6
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Direxion Daily 20+ Year Treasury Bull 3X Shares
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adversely affecting the Funds performance. In addition, closed end investment company and ETF shares potentially may trade at a discount or a premium and are subject to brokerage and other
trading costs, which could result in greater expenses to the Fund. Finally, because the value of ETF shares depends on the demand in the market, the Adviser may not be able to liquidate the Funds holdings in those shares at the most optimal
time, adversely affecting the Funds performance.
Tax and Distribution Risk
The Fund has extremely high portfolio
turnover which causes the Fund to generate significant amounts of taxable income. This income is typically short-term capital gain, which is generally treated as ordinary income when distributed to shareholders, or short-term capital loss. The Fund
rarely generates long-term capital gain or loss. The Fund will generally need to distribute this income in order to satisfy certain tax requirements. As a result of the Funds high portfolio turnover, the Fund could make larger and/or more
frequent distributions than traditional unleveraged ETFs. Because the Funds asset level changes frequently, these distributions could comprise a substantial portion or even all of the Funds net assets if the Fund distributes this income
after a decline in its net assets. In addition, the Fund may be held by short-term investors and these investors may exit the Fund prior to the record date of a distribution. As a result, shareholders in the Fund on the day of a distribution may
receive substantial distributions, which could lead to negative tax implications for such shareholders. Potential investors are urged to consult their own tax advisers for more detailed information.
Rules governing the federal income tax aspects of certain derivatives, including total return equity swaps, real estate-related swaps, credit
default swaps and other credit derivatives are not entirely clear. Because the Funds status as a regulated investment company might be affected if the Internal Revenue Service did not accept the Funds treatment of certain transactions
involving derivatives, the Funds ability to engage in these transactions may be limited.
Tracking Error Risk
The
Fund may have difficulty achieving its daily target due to fees and expenses, high portfolio turnover, transaction costs, and/or a temporary lack of liquidity in the markets for the securities held by the Fund. A failure to achieve a daily target
may cause the Fund to provide returns for a longer period that are worse than expected. In addition, even though the Fund may meet its daily target for a period of time, this will not necessarily produce the returns that might be expected in light
of the returns of the Index or the Funds benchmark for that period.
U.S. Government Securities Risk
A security
backed by the U.S. Treasury or the full faith and credit of the United States is guaranteed only as to the timely payment of interest and principal when held to maturity. The market prices for such securities are not guaranteed and will fluctuate.
In addition, because many types of U.S. government securities trade actively outside the United States, their prices may rise and fall as changes in global economic conditions affect the demand for these securities.
Special Risks of Exchange-Traded Funds
Not Individually Redeemable.
Shares are not individually redeemable and may be redeemed by the Fund at net asset value
(NAV) only in large blocks known as Creation Units. You may incur brokerage costs purchasing enough Shares to constitute a Creation Unit.
Trading Issues.
Trading in Shares on an exchange may be halted due to market conditions or for reasons that, in the view of that exchange, make trading in Shares inadvisable, such as extraordinary
market volatility or other reasons. There can be no assurance that Shares will continue to meet the listing requirements of the exchange on which it trades, and the listing requirements may be amended from time to time.
Market Price Variance Risk.
Individual Shares of the Fund that are listed for trading on an exchange can be bought and sold in the
secondary market at market prices. The market prices of Shares will fluctuate in response to changes in NAV and supply and demand for Shares. The Adviser cannot predict whether Shares will trade above, below or at their NAV. Differences between
secondary market prices and NAV for Shares may be due largely to supply and demand forces in the secondary market, which forces may not be the same as those influencing prices for securities or instruments held by the Fund at a particular time.
Given the fact that Shares can be created and redeemed in Creation Units, the Adviser believes that large discounts or premiums to the NAV of Shares should not be sustained. There may, however, be times when the market price and the NAV vary
significantly and you may pay more than NAV when buying Shares on the secondary market, and you may receive less than NAV when you sell those Shares. The market price of Shares, like the price of any exchange-traded security, includes a
bid-ask spread charged by the exchange specialists, market makers or other participants that trade the particular security. In times of severe market disruption, the bid-ask spread often increases significantly. This means that Shares
may trade at a discount to NAV and the discount is likely to be greatest when the price of Shares is falling fastest, which may be the time that you most want to sell your Shares. The Funds investment results are measured based upon the daily
NAV of the Fund over a period of time. Investors purchasing and selling Shares in the secondary market may not experience investment results consistent with those experienced by those creating and redeeming directly with the Fund. There is no
guarantee that an active secondary market will develop for Shares of the Fund.
Fund Performance
The following performance information provides some indication of the risks of investing in the Fund by demonstrating how its returns have varied from calendar year
to calendar year. The table shows how the Funds average annual returns for the 1-year and since inception periods compare with those of a broad-based market index for the same periods. The Funds past performance, before and after taxes,
is not necessarily an indication of how the Fund will perform in the future. Updated performance is available on the Funds website at http://direxionshares.com/etfs?performance or by calling the Fund toll free at 1-866-476-7523.
The performance shown prior to September 13, 2010 reflects a previous investment objective. The Fund sought daily investment results, before
fees and expenses, of 300% of the performance of the NYSE Current 30-Year U.S. Treasury Index. If the Funds objective had remained the same, the calendar year performance of the Fund would have varied from that shown.
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Summary Prospectus
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5 of 6
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Direxion Daily 20+ Year Treasury Bull 3X Shares
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Calendar Year Total Return as of December 31
During the period of time shown in the bar chart, the Funds highest calendar quarter return was 104.10% for the quarter
ended September 30, 2011 and its lowest calendar quarter return was (26.92)% for the quarter ended December 31, 2010. The year-to-date return as of March 31, 2012 was (9.61)%.
Average Annual Total Returns
(For the periods ended December 31, 2011)
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One Year
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Since Inception
(4/16/2009)
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Return Before Taxes
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105.44%
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14.09%
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Return After Taxes on Distributions
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104.91%
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11.49%
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Return After Taxes on Distributions and Sale of Fund Shares
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68.52%
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10.27%
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NYSE 20 Year Plus Treasury Bond Index
(reflects no deduction for fees, expenses or taxes)
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33.50%
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31.81%
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After-tax returns are calculated using the historically highest individual federal marginal income tax rates and do not reflect the
impact of state and local taxes. Actual after-tax returns depend on an investors tax situation and may differ from those shown, and after-tax returns are not relevant to investors who hold their Fund shares through tax-deferred arrangements,
such as 401(k) plans or individual retirement accounts. In addition, the Return After Taxes on Distributions and Sale of Fund Shares would be higher if the investor recognized a capital loss upon the redemption of Fund shares.
Management
Investment Adviser.
Rafferty Asset Management, LLC is the Funds investment adviser.
Portfolio
Manager.
Paul Brigandi, the Funds Portfolio Manager, is primarily responsible for the day-to-day management of the Fund and has served in this role since the Funds inception in April of 2009.
Purchase and Sale of Fund Shares
The Fund
will issue and redeem Shares only to Authorized Participants (typically, broker-dealers) in exchange for the deposit or delivery of a basket of assets (securities and/or cash) in large blocks, known as Creation Units, each of which is comprised of
50,000 Shares. Retail investors may only purchase and sell Fund Shares on a national securities exchange through a broker-dealer. Because the Shares trade at market prices rather than net asset value, Shares may trade at a price greater than net
asset value (premium) or less than net asset value (discount).
Tax Information
Income and capital gain distributions you receive from the Fund are subject to federal income taxes and may also be subject to state and local taxes. Distributions
for this Fund may be significantly higher than those of most exchange-traded funds.
Payments to Broker-Dealers and Other Financial
Intermediaries
If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank or financial advisor), the Fund
and/or the Adviser may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other financial intermediary and your salesperson to recommend the
Fund over another investment. Ask your salesperson or visit your financial intermediarys website for more information.
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Summary Prospectus
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6 of 6
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Direxion Daily 20+ Year Treasury Bull 3X Shares
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