On April 9, U.S. stocks staged a spectacle.On one hand, there is the bleak reality that the Nasdaq 100 index has fallen by 19% year-to-date and the "seven technology giants" have fallen sharply before the market. On the other hand, there is a crazy record of triple-leveraged fund TQQQ attracting US$1.5 billion in a single day.This seemingly contradictory scene reflects the extreme differences among market participants on the future direction of technology stocks-some people are selling in panic, but more people are licking blood at the tip of the knife, trying to leverage the opportunity for huge profits to rebound.

The current sense of tearing in the market is first reflected in the intensity of price fluctuations.Take TQQQ, which tracks the Nasdaq 100 index, as an example. The fund once surged by 13.5% in early trading on April 8, but reversed its decline by 5.7% at the close, with a single-day amplitude of nearly 20%.This roller-coaster trend is closely related to supply chain anxiety caused by the Trump administration's resumption of tariff policies.According to analysis, tariff increases on technology products have directly impacted core areas such as semiconductors and consumer electronics, causing heavyweights such as Nvidia and Intel to fall by more than 30% during the year.However, the more volatile the market becomes, the more excited some funds become-TQQQ's net inflow of funds during the year has exceeded US$3 billion. Even though its net worth has been halved, investors still regard the 50% decline as a "discounted admission ticket."

Roxanna Islam, director of research at TMX VettaFi, pointed out that the current market has entered a stage of "news-driven volatility", and slight changes in policy wind direction may trigger exponential reactions.The operating mechanism of leveraged funds just amplifies the arbitrage space in this volatility: assuming that the Nasdaq 100 index rebounds by 5% in a single day, TQQQ can theoretically earn a return of 15%. This nonlinear return is fatal to short-term traders.Jay Jacobs, head of BlackRock ETF, observed that a large amount of money is implementing "reverse operations" through leveraged products, trying to capture opportunities for oversold rebound in panic selling.A typical representative of this strategy is semiconductor triple-long fund SOXL. Although the fund fell 48% in April, it still attracted $2.4 billion in bargain-hunting funds.

If you lengthen the perspective to the full-year cycle, you will find that there is a deep connection between the enthusiasm of leveraged funds and the macroeconomic narrative.

At the beginning of 2025, the market was optimistic because corporate financial reports exceeded expectations and AI infrastructure investment craze-Tesla's target price was raised to US$500, Netflix's quarterly revenue exceeded US$10 billion, and Trump's "Stargate" The AI plan also outlines an investment blueprint of US$500 billion.However, policies turned sharply at the end of the first quarter, combined with heavy tariffs and rising expectations of the Federal Reserve to raise interest rates, causing the risk premium in the valuation model of technology stocks to increase sharply.The influx of leveraged funds at this time is essentially a bet on the mismatch between the "policy bottom" and the "market bottom": investors are betting that the earnings resilience of technology giants is enough to offset macro risks, and the Fed's tightening cycle may turn ahead due to weak economic data.

However, the exposure to this big bet is widening sharply.From a valuation perspective, the S & P 500 P/E ratio is still at a historically high level, and the technology sector's forward PE is 40% premium to the ten-year average.Even considering the productivity gains brought about by the AI revolution, current prices have overdrawn growth expectations for the next three years.What is even more noteworthy is the endogenous vulnerability of leveraged funds-take TQQQ as an example. Its daily reset of leverage will lead to "Volatility Decay" in a unilateral falling market.Assuming that the index has fallen by 5% for three consecutive days, with a cumulative loss of 14.3%, and TQQQ will plummet by 38.6% due to triple leverage, which means that holders will have to bear losses in the square order of the index's decline.When markets fall into high volatility, such products may become a black hole that consumes principal.

Faced with this complex situation, the strategies of professional institutions are polarized.Some fund managers choose to follow the trend and capture volatile dividends from leveraged funds through intraday trading; others turn to defensive allocation and increase their holdings of infrastructure and green technology companies with stable cash flows.Goldman Sachs 'latest research report reminds that the current risk-return ratio of technology stocks is unbalanced. Investors are advised to strictly define tools such as TQQQ as tactical positions and set stop loss lines within 5%.Morgan Stanley believes that markets are repeating the script of March 2020-extreme panic often breeds violent rebounds, but this time the difference is that the Fed's policy toolbox is no longer sufficient.