A Redditor posted a screenshot to r/wallstreetbets last week with the title “Boring $4,000,000 gain with triple-leveraged SPXL. I told WSB 6mo ago I would sell at $3.1m, am glad I TACO’ed.”
The position is Direxion Daily S&P 500 Bull 3X Shares (NYSEARCA:SPXL), bought on May 10, 2010. The investor owns 14,760 shares at a split-adjusted cost of $4.75, for a total cost basis of $70,096.96. As of May 14, 2026, that stake is worth $4,090,890.46. The unrealized gain is $4,020,793.50, all filed under long-term capital gains with $0.00 short-term. That is one buy ticket, sixteen years, zero sales. The return is 5,736%, roughly 58 times the money.
The same screenshot notes SPXL printed a fresh 52-week high that day, closing the prior session at $270.58 and trading up another $6.58 to $277.16. SPXL closed yesterday at $278.37.
What SPXL actually does, and why this outcome was not the plan
SPXL is engineered to deliver 3x the daily return of the S&P 500. Every afternoon the fund rebalances its swap exposure back to 300% of the prior close. That daily reset is the whole product, and it is also the thing that should have made this trade fail.
The mechanism is path dependence. If the index drops 10% and bounces 10% the next day, you are down roughly 1%. SPXL, doing the same dance at triple speed, is down closer to 9%. Run that loop for years and the leveraged fund bleeds value even when the unleveraged index goes nowhere. Direxion says so in its own prospectus. Every textbook and disclosure treats SPXL as a tactical instrument, held for days, not decades.
So why did $70K become $4 million instead of a tax-loss write-off?
The mechanism that turned a tactical product into a 16-year hold
Path dependence cuts both ways. Volatility drag punishes a chop tape and rewards a smooth uptrend. The post-2010 S&P 500 delivered one of the cleanest grinding bull markets in American history. Quantitative easing, near-zero rates through 2022, a brief v-shaped COVID drawdown, and a mega-cap tech cycle pulled the index higher year after year. SPDR S&P 500 ETF Trust (NYSEARCA:SPY) itself returned 544% from May 10, 2010 to May 14, 2026, with start and end prices of $116.16 and $748.17. SPXL, over the identical window, returned 6,312%, from $4.32 to $276.90.
That ratio, roughly 12x the unleveraged return on a fund supposed to give you 3x for one day, is what happens when daily leverage compounds inside a low-volatility uptrend. The 2020 crash was vicious but brief. The 2022 bear market was orderly. Realized volatility of the S&P over the full hold sat low enough that the drag never caught up to the trend. The investor identified a buy-and-hold regime and avoided any extended sideways grind long enough to gut the position.
Whether the next sixteen years rhyme
The S&P trades at a forward earnings multiple in the low 20s, near the top of its long-run range. SPXL itself is up 87% in the last year alone and 27% year to date, while SPY is up about 10% YTD. Starting valuation matters more than mechanism for forward returns, and starting from here is not starting from May 2010.
What you actually want to watch is the VIX trend and realized volatility on the S&P. SPXL works when daily moves stay small and directional. It eats principal when they get large and choppy. If realized vol settles in the high single digits and the index drifts higher, the path stays friendly. If vol expands and the index goes sideways for two years, the same product that minted this gain becomes the engine that destroys it. The 2010 buyer’s edge showed up in the holding, not the picking, once the regime revealed itself. The regime has to keep cooperating for anyone starting today to repeat the trick.
I wouldn’t try to copy this investor in 2026. You could do a tactical buy if you believe the current rally is yet to turn truly euphoric, but something like the TQQQ (NASDAQ:TQQQ) is a much better vehicle for that. If you do want to try something similar over the long term, wait for a significant dip and then get in. Remember, the S&P 500 in May 2010 was down 27% when compared to March 2000 prices.
Contact [email protected] for any questions or corrections.
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