I am reading about leveraged etfs and I am very confused. It seems they don't always follow the stock prices they should be following and not always doing what they are supposed to do. For example a long leveraged etf may actually go down, even though the stocks it tracks go up, because they use complicated financial instruments to achieve leverage.
In my case, however, I am simply looking for a leveraged, long only tesla ETF. Would an ETF like that, behave more like a simple margin account, meaning in follows the price perfectly, or can it also do something unexpected? After all it wouldn't need rebalancing at least.
Why aren't leveraged etfs simply using margin instead of these complicated instruments? And finally, how would margin calls work say in 2TSLEX? Would the fund get called faster than my personal account? Do they just take all client money and invest all of it on max margin, meaning they will get called, if the stock drops 75%? If they get margin called, do the customers get the opportunity to deposit money to save their own investment?
Someone told me, that if a 10x etf's tracked stock drops 10%, the fund loses 90%, but when the stock gains 10%, the fund only doubles (and is presumably still at -50%). Is that even possible?