XEUR seeks to deliver 2x the daily performance of Vanguard FTSE Europe ETF (NYSE Arca: VGK), which tracks an index that provides comprehensive, vanilla exposure to large-, mid-, and small-cap companies from developed European countries including the UK. Rather than holding VGK directly, the fund primarily uses derivatives such as swap agreements and options to create leveraged exposure. The portfolio is rebalanced at the end of each trading day to maintain its targeted leverage level, meaning returns over periods longer than a single day can differ significantly from 2x the cumulative return of VGK due to compounding effects. The fund may also obtain leveraged exposure through exchange-traded equity futures and options, including standardized calls and puts. Collateral supporting these derivative positions may be invested in money market instruments, repurchase agreements, or short-term US government securities.