The scale of leveraged ETFs has surged, amplifying market volatility, while day trading momentum on Wall Street has experienced explosive growth.

With the explosive growth of leveraged ETF assets, their daily mechanical rebalancing mechanism is significantly amplifying market volatility, thereby creating new profit avenues for Wall Street's intraday momentum trading strategies. Currently, sectors such as semiconductors have become core areas for such short-term trend trading. The operational mechanism of leveraged ETFs determines their inherent pro-cyclical characteristics. To maintain a set leverage ratio, these funds must buy more when the market rises and are forced to sell when it falls. Against this backdrop, intraday momentum strategies focused on high-volatility assets have seen significant growth. Data shows that since 2024, the number of effective intraday momentum strategies targeting the semiconductor industry has more than doubled. These strategies capture short-term trends during significant price fluctuations through strict quantitative rules, and their risk-adjusted returns far exceed the overall performance of the U.S. stock indices. JPMorgan strategists point out that the current high volatility in the market reminds one of the technology revolution period in 1998, providing an excellent trading environment for intraday momentum strategies.