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Fund Information

The Financial Trends Strategy Fund

The advantages of investing in the Fund

Individuals can benefit in numerous ways when they invest in the Financial Trends Strategy Fund, since the Fund:

  • helps investors maintain returns earned in domestic securities when the U.S. dollar is declining in value;
  • provides investors with a hedge against fluctuations in interest rates;
  • provides investors with a hedge against inflation/deflation;
  • may be a good complement to fixed income portfolios;
  • helps to decrease the volatility of portfolios over the long term; and
  • eliminates subjective decision-making due to its quantitative approach.

Maintaining returns earned in domestic securities

The value of the dollar has important implications for investors. The dollar is a world reserve currency and it is valued relative to other major world currencies. When the price of a stock declines, investors see the decline in their investment statements. However, the decline in the value of a currency is somewhat less obvious to many investors – especially those who are focused on domestic markets.

Let's look at an example of how currency values can affect a portfolio. From March 31, 2008 through March 31, 2009, the S&P 500® Index declined 38.1% in dollar terms, at a time when the U.S. dollar appreciated 19.1% against the euro. (As the dollar appreciated, the performance of the S&P 500 was improved when its return was expressed in Euros.) Consequently, the S&P 500 was actually only down 26% when its perfor­mance was measured in Euros.

Conversely, from March 31, 2009 through December 31, 2009, the S&P 500 rose 42.1% in dollar terms, at a time when the US Dollar depreciated by 7.5% against the Euro. (As the dollar depreciated, the perfor­mance of the S&P 500 was depreciated when its return was expressed in Euros. In this case, the S&P 500 was actually only up 31% when its performance was expressed in Euros.

On the other hand, the dollar value of international equities increases as the dollar declines against their home currencies, even if the values of their shares have not appreciated in their home currency. For inves­tors, the dollar's decline creates a headwind for domestic securities and a tailwind for non-dollar securities.



The Financial
Trends Strategy Fund		 Why
Financial Futures		 Why a Long/Short
Financial Futures Strategy?		 Why Invest in the
fund		 Advantages


An investor should consider the investment objectives, risks, charges, and expenses of the Direxion funds carefully before investing. The prospectus contains this and other information about Direxion funds. To obtain a prospectus, please contact Direxion Funds at 800.851.0511. The prospectus should be read carefully before Investing. Investing in funds that invest in specific industries or geographic regions may be more volatile than investing in broadly diversified funds.

The risks associated with the Direxion Financial Trends Strategy Fund are detailed in the prospectus and Statement of Additional Information (available upon request, free of charge). These include, but are not limited to, risks of high portfolio turnover; risk of tracking error; leverage, derivatives and counterparty risks; risk of non-diversification; risk of interest rate changes; risks of investing in other investment companies and Exchange-Traded Funds (ETFs); risks of investing in equity securities and foreign instruments; risks of currency exchange rates; market risk, risk of options and futures contracts; risk of shorting instruments; volatile markets; security selection risk; credit risk; and valuation time risk.



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