Leveraged and inverse ETFs promise a multiple of their underlying's daily move, reset each day. Over the three months to October 6, 2026, 488 of 621 such funds finished short of that stated multiple. The median fund was 6.0 points off its target, even though the median underlying only travelled 7.0% over the period. That gap is the arithmetic of daily compounding: a fund that delivers 2x or 3x on any single day does not deliver 2x or 3x on a string of days, because each day's gain or loss resets against a new base. The wider the underlying swings along the way, win or lose, the larger the drift from the stated multiple tends to be, regardless of where the underlying ends up.
The one-month window shows a smaller median difference, -1.1%, against median underlying movement of 1.6% and median volatility of 38%. By three months the gap widens to -6.0% as volatility rises to 47%. At six months it reaches -9.3%, then eases slightly to -8.5% at one year and -5.6% at three years, even as the volatility numbers for those longer windows fall back to 34% and 19%. Across all five windows, roughly six or seven in ten funds land short of their stated multiple.
The pattern holds when funds are grouped by how much their underlying actually moved around. Funds tracking underlyings with 0% to 30% volatility had a median difference of -1.8%, with 115 of 178 short of stated. That gap widens step by step: -5.0% for the 30%-to-50% band, -12.3% for 50%-to-80%, and -20.5% for underlyings at 80% volatility and above, where 108 of 115 funds fell short. The more an underlying moves around day to day, the further the three-month result tends to sit from the stated multiple.
The same mandate can also produce different outcomes depending on issuer. The data identifies 100 underlyings tracked by the same stated multiple from more than one issuer, and the spread between the closest and furthest fund on the same trade varies by underlying. On ONDS at +2x, four issuers produced a 7.1-point spread between ONDU and ONDL, on an underlying that moved just +0.8%. On MSTR at +2x, where the underlying moved +69.0%, the spread between MSTC and MSTX was 6.4 points. Smaller spreads appear elsewhere: AMD +2x shows a 3.3-point spread between AMDC and AMDL, and XRPR +2x shows 3.2 points between UXRP and XXRP. In every row listed, funds chasing the identical stated multiple on the identical underlying, over the identical days, still land in different places.
Readers can check any individual fund's three-month distance from its stated multiple, its underlying's volatility over the same window, and how it compares with other issuers tracking the same underlying, on the live desk.