Direxion HCM Tactical Enhanced US ETF

The Fund uses a proprietary quantitative investment model based on the HCM-BuyLine (the “Model”) developed by the Fund’s subadviser, Howard Capital Management, Inc. (“Subadviser”), to determine the Fund’s allocation to U.S. equity securities and/or cash and cash equivalents (i.e., U.S. money market funds, U.S. government securities and/or similar securities). The Fund will invest in, or have exposure to, U.S. equity securities in order to achieve capital appreciation, or will invest in cash or cash equivalents in order to attempt to preserve capital during market downturns. When the Model indicates a change in market trends, the Fund may be invested in a combination of U.S. equities and cash or cash equivalents. When allocated to U.S. equities, the Fund will seek leveraged exposure of its net assets through investments in derivatives, such as swaps, in order to achieve enhanced returns.

When the Fund is allocated to U.S. equity securities, it will have approximately the following daily exposures: 80% to the securities of the S&P 500^® Index (“S&P Allocation”),  up to 80% exposure to all of the securities of the NASDAQ-100 Index (“NASDAQ Allocation”), and up to 40% exposure to the securities of a specific sector or industry (“Sector Allocation”).^** The Fund will utilize leverage to achieve total exposure of up to 200% of the Fund’s net assets to these allocations.

The Subadviser provides the Fund’s investment adviser, Rafferty Asset Management, LLC (“Adviser”), with investment signals (“Investing Signals”) pursuant to the Model’s determinations. The Adviser is responsible for investing the Fund’s assets pursuant to the Investing Signals and may rebalance the Fund’s portfolio as frequently as daily when invested in U.S. equity securities so that its exposure to the allocations is consistent with the Fund’s investment strategy.

Howard Capital Management, Inc. (HCM) is a SEC-Registered Investment Advisory Firm founded by Vance Howard, which offers professional money management services to private clients, financial advisors, and registered investment advisors through a suite of separately managed accounts, retirement tools, self-directed brokerage accounts, proprietary mutual funds and ETFs. HCM has $4 Billion in Assets Under Management.

The Direxion Shares ETF Trust is a registered investment company offering a number of separate exchange-traded funds. Rafferty Asset Management, LLC serves as the investment adviser to the Fund and Howard Capital Management, Inc. serves as the subadviser to the Fund.

• HCM-BuyLine^® relies on rules based technical indicators to independently determine an investment in the S&P 500 Allocation, NASDAQ Allocation, and a Sector Allocation.
• Each of the three components will independently utilize the HCM BuyLine^® to determine either a buy signal, resizing of long position, or an outright sell.
• When any of the three components close below the HCM-BuyLine^® based on a pre- determined percentage threshold, a downtrend is established and the Model generates a sell signal. The strength of that signal will determine the resizing of the individual component. If there is a strong enough sell signal a component can be completely in Cash.
• When the Model generates a buy signal for an individual component within the Fund, that component may have magnified exposure and deleverage if the buy signal weakens.
• Each individual component weightings can range anywhere from 0-200% exposure depending on the strength of the signals.

**The S&P 500 Index measures the performance of 500 large capitalization companies listed on stock exchanges in the U.S. The NASDAQ-100 Index represents all of the 100 largest, U.S.-based, non-financial companies listed on the NASDAQ Stock Exchange. The Sector Allocation is the securities of a specific sector or industry. The Sector Allocation will be in one of the following 13 sectors or industries: industrial sector, communication services sector, consumer discretionary sector, consumer staples sector, energy sector, financial sector, health care sector, real estate sector, technology sector, utilities sector, materials sector, biotechnology industry and semiconductor industry.