Single-stock exchange-traded funds are the hoverboards of finance. They provide no real utility and might catch fire and explode at any moment.
Leveraged and inverse single-stock ETFs were first approved for US trading in 2022, prompting a rare companion statement from former SEC Commissioner Caroline Crenshaw, saying, “… it would likely be challenging for an investment professional to recommend such a product to a retail investor while also honoring his or her fiduciary obligation or obligations under Regulation Best Interest.”
After four years on the ETF market, Crenshaw’s warning has proven prescient. Single-stock ETFs have mostly been as disastrous for investors as they have been lucrative for their asset managers: The median single-stock ETF has lost 38% while having paid over $6 billion in management fees on them over the past four years ended July 2026.
