Investors Pile Into “Falling Knife” Funds as Chip Stocks Tumble

Leveraged single-stock exchange-traded funds (ETFs) are drawing billions in new cash even as their value collapses during the current technology sell-off. These high-risk funds, which amplify daily stock moves, have seen record inflows despite steep losses. The trend suggests some investors are betting on a sharp rebound in semiconductor shares, a strategy often described as “catching a falling knife.” While the potential for quick gains exists, these products are designed for short-term trading and can wipe out capital rapidly if the market keeps sliding.