Robinhood slump highlights watch on HODU leveraged ETF
Robinhood shares are down nearly a third after a Q1 crypto slump and a 4.6% sequential drop in customer assets; $18B net deposit growth and product moves have analysts watching HODU.
Robinhood Markets shares have lost nearly a third of their value year to date after a first-quarter decline in cryptocurrency trading and a 4.6% sequential decrease in customer assets. The company reported weaker crypto activity in the first three months of 2026 as bitcoin prices fell.
Some market participants are monitoring the Direxion Daily HOOD Bull 2X ETF (HODU). The fund seeks to deliver 200% of Robinhood’s daily stock performance and is structured for short-term trading rather than long-term holding.
Morningstar analyst Sean Dunlop highlighted $18 billion in net deposit growth at Robinhood, which he quantified as 22% annualized growth. Dunlop identified deposit momentum and execution on initiatives described in the company’s fourth-quarter call as key indicators for future performance and set out 10-year compound annual growth rate projections of 13.0% for revenue, 14.2% for operating profit and 17.3% for diluted earnings per share.
Robinhood has broadened its product lineup beyond commission-free trading. The company has generated revenue from event contracts through a partnership with Kalshi and is rolling out an in-house prediction market platform called Rothera. Robinhood reported retirement account assets of $27.4 billion and said its banking product has nearly $2 billion in deposits.
HODU is a leveraged ETF that multiplies daily returns. Because the fund resets daily, its returns can diverge from the underlying stock’s long-term performance when held over multiple days. Leverage can amplify both gains and losses in short periods.
Analysts and traders cite several indicators to watch for near-term moves in Robinhood’s stock and in HODU’s price behavior: crypto trading volumes on the platform, bitcoin prices, net deposit growth, customer adoption of Robinhood banking products and the pace of the Rothera rollout.
First-quarter crypto weakness and the drop in customer assets have reduced interest among some investors in the leveraged fund. At the same time, the company’s reported deposit inflows and product expansion are factors referenced by analysts who continue to track the ETF for short-term trading opportunities.
