Why $TSLL Performed MUCH WORSE Than Tesla Stock in 2025 (MUST WATCH!)
Overall Thesis
The host argues that 2x daily leveraged Tesla ETFs like TSLL and TSLS are structurally flawed long-term holdings because of daily rebalancing volatility decay. Despite Tesla being up ~19% YTD, TSLL is down ~18% and TSLS is down ~31% — both lose money regardless of direction — so he warns viewers that leveraged funds are value-destroyers in volatile sideways markets.
Narratives
TSLL is a daily-reset 2x leveraged ETF, not a true 2x Tesla proxy, so volatility decay destroys value in sideways or choppy markets. Even though Tesla is up ~19% YTD, TSLL is down roughly 18% because leverage resets daily and repeated up/down moves compound against the holder.
Key Arguments
- TSLL leverages Tesla 2x on a daily basis with daily resets, not cumulatively
- In a stylized example of alternating +10%/-9.09% moves, Tesla returns 0% over 6 days while TSLL loses ~5%
- Per Direxion's one-pager as of September 30, TSLL was down 21% YTD while TSLS was down 31%
- Tesla's volatile range (down to 220 and up to 490) maximally punishes daily-reset leveraged ETFs
Tesla itself has performed well in 2025, up about 19% year-to-date, after a volatile range from roughly 220 to 490. The host uses Tesla as the reference benchmark and is clearly positive on holding the underlying stock versus leveraged ETFs.
Key Arguments
- Tesla is up ~19% year to date as of December 19
- Tesla traded in a volatile range from 220 to 490 during the year
- Holding Tesla outperformed the 2x leveraged TSLL by roughly 38 percentage points year to date
TSLS suffers the same daily-reset volatility decay as TSLL, and is an even worse investment in 2025 given Tesla has risen. As of end of Q3, TSLS was down 31% YTD, meaning bears who held it lost more than bulls who held TSLL.
Key Arguments
- TSLS is the daily-reset bear counterpart and down 31% per the September 30 one-pager
- Both long and short daily-reset leveraged ETFs lose money because of the same compounding math
- Heads you lose, tails you lose — both bull and bear fund holders ended the year with large losses