Oracle ETFs Face Market Test Amid Data Center Volatility

Leveraged Oracle ETFs faced an early test of volatility Wednesday as news of stalled data center funding talks sent Oracle Corp. (ORCL) shares down 4.8% midday. That triggered sharp moves in both the bull and bear products launched less than a month ago.

The Direxion Daily ORCL Bear 1X ETF (ORCS) gained 4.7% while the Direxion Daily ORCL Bull 2X ETF (ORCU) dropped 9.6%, according to ETF Database data. The contrasting performances highlights how these single-stock products respond to volatility after reports emerged that Blue Owl Capital won’t back Oracle’s planned $10 billion Michigan data center.

The volatility comes as Oracle shares struggle through a difficult month. The stock has fallen 18.3% over 30 days despite posting an 8.2% year-to-date gain. Financial Times reported Blue Owl’s pullback stems from concerns about Oracle’s rising debt and artificial intelligence infrastructure spending.

Oracle disputed the report, saying its development partner Related Digital “selected the best equity partner from a competitive group of options, which in this instance was not Blue Owl,” according to a company statement provided to the FT. The cloud computing giant added that negotiations for the equity deal are “moving forward on schedule and according to plan.”

Oracle ETF Flows Show Early Investor Interest

The two Direxion funds launched November 19. ORCU seeks to deliver 200% of Oracle’s daily performance, while ORCS seeks 100% of Oracle’s moves in the opposite direction. Both carry 0.97% expense ratios.

ORCS has attracted $2.68 million in net flows over the past month and $1.22 million over five days, building assets under management to $5.4 million, according to ETF Database. The fund’s one-month return stands at nearly 17%.

ORCU has seen stronger inflows despite negative performance. It pulled in $24.71 million over the past month and $19.21 million in the last five days. The bull fund now manages $16.7 million in assets but has posted a decline of nearly 33% over the past month, as Oracle shares declined.

The volatility highlights concerns about Oracle’s expanding commitments. The company disclosed $248 billion in lease obligations for data centers and cloud capacity as of November 30, according to Financial Times. That’s up 148% from August. Net debt including lease obligations reached $105 billion, with Morgan Stanley forecasting that figure could hit $290 billion by 2028.

The Michigan facility was planned as a 1-gigawatt data center to serve OpenAI under a $300 billion partnership announced in September. Blue Owl previously backed Oracle’s $15 billion Abilene, Texas site and $18 billion New Mexico campus.

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