XPP is a leveraged play on Chinese large-caps, aiming for 2x the daily returns of the popular FTSE China 50 Index, which is also tracked by the huge iShares China Large-Cap ETF (FXI). The index targets the largest Chinese companies traded in Hong Kong, meaning XPP is mostly a bet on China's state-owned enterprises. Exposure to financials is particularly massive here. Since the fund rebalances its leverage on a daily basis, actual returns can significantly deviate from expected returns over the long term due to compounding effects, so XPP is meant as a short-term trading vehicle.
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