Direxion Daily TSLA Bear 1X Shares (TSLS) Covered Calls

The Direxion Daily TSLA Bear 1X Shares is an actively managed exchange-traded fund that seeks to provide the inverse of the daily performance of the common stock of Tesla, Inc. The fund utilizes financial instruments, primarily swap agreements, to achieve a -100% daily return target. It is designed as a tactical tool for investors looking to profit from price declines or hedge against pullbacks in this leading electric vehicle and clean energy company without using a margin account.

You can sell covered calls on Direxion Daily TSLA Bear 1X Shares to lower risk and earn monthly income. Born To Sell's covered call screener gives you customized search capabilities across all possible covered calls but here are a couple of examples for TSLS (prices last updated Mon 4:16 PM ET):

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Direxion Daily TSLA Bear 1X Shares is a specialized inverse investment vehicle designed to deliver the daily opposite of Tesla’s price performance. Unlike leveraged bear funds, TSLS offers a "one-to-one" inverse ratio, providing a more direct way for traders to bet against the electric vehicle giant or protect a tech-heavy portfolio from a correction in one of its most volatile components.

Core Strategy and Operations

1. Inverse Daily Objective: The fund seeks daily investment results, before fees and expenses, of 100% of the inverse (or -100%) of the performance of Tesla. If the stock falls 1% in a single trading session, the fund is designed to rise 1%. To achieve this, the fund primarily engages in swap agreements with major financial institutions to gain synthetic short exposure while holding a substantial portion of its assets in cash and U.S. Treasury instruments as collateral.
2. Daily Reset Mechanism: TSLS rebalances its exposure at the close of every trading day. Because of this daily reset, the fund’s performance over periods longer than one day is subject to the effects of compounding. While the "volatility decay" is typically less aggressive here than in 2x or 3x leveraged inverse funds, the fund may still deviate from a perfect inverse relationship during periods of extreme multi-day volatility.
3. Operational Benefits: TSLS allows investors to effectively "short" Tesla without the traditional requirements of a margin account, the need to borrow physical shares, or the theoretical risk of infinite loss associated with a direct short position. As of 2026, the fund maintains a net expense ratio of approximately 0.94% to 0.95%.

Competitive Landscape

TSLS is the standard choice for "unleveraged" short exposure to Tesla. Its most direct competitor is the Tradr 2X Short TSLA Daily ETF, which offers a more aggressive 2x inverse profile. For traders who prefer an option-based income approach to bearishness, the YieldMax Short TSLA Option Income Strategy ETF is a frequent alternative. It is also used as a tactical hedge by investors who are long on bullish Tesla products like the Direxion Daily TSLA Bull 2X Shares or the YieldMax TSLA Option Income Strategy ETF but fear a near-term price drop.

Strategic Outlook and Innovation

Management focuses on providing precise daily tracking and high liquidity to serve the needs of intraday traders and institutional hedgers. In the 2026 market, TSLS is frequently utilized during periods of high valuation uncertainty or following major delivery and earnings reports. While it lacks the 2x leverage of some peers, it remains a high-risk, non-diversified product. If the underlying stock experiences a sustained rally, TSLS will lose value. It remains a primary liquidity tool for participants who believe the EV sector is due for a valuation reset or for those seeking to mitigate "Tesla-specific" risk in a concentrated growth portfolio.

Want more examples? TSLR Covered Calls | TSLT Covered Calls