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Wolf Haldenstein Adler Freeman & Herz LLP Commences Class Action Lawsuit on Behalf of Direxion Energy Bear 3X Shares Fund Investors

Wolf Haldenstein Adler Freeman & Herz LLP today filed a class action lawsuit in the United States District Court, Southern District of New York, on behalf of all persons who purchased or otherwise acquired the shares of Direxion Energy Bear 3X Shares Fund (“the Energy Bear Fund”) [NYSE:ERY] an exchange-traded fund (“ETF”) offered by Direxion Shares ETF Trust (“Direxion Shares” or the “Trust”), pursuant or traceable to Direxion Shares’ false and misleading Registration Statement, Prospectuses, and Statements of Additional Information (collectively, the “Registration Statement”) issued in connection with the Energy Bear Fund’s shares against Direxion Shares, officers and trustees of Direxion Shares, and the Energy Bear Fund’s investment advisor, alleging claims pursuant to Sections 11 and 15 of the Securities Act [15 U.S.C. §§77k and 77o] (the “Class") during the period November 5, 2008 through April 9, 2009, inclusive, (the “Class Period”).

The case name is styled Schwack v. Direxion Shares ETF Trust, et al. and the index number is 10-271. A copy of the complaint filed in this action is available from the Court, or can be viewed on the Wolf Haldenstein Adler Freeman & Herz LLP website at www.whafh.com.

Direxion Shares consists of a series of ETFs, including the Energy Bear Fund. ETFs, regulated by the SEC under the Investment Company Act of 1940 (the “1940 Act”), are low-cost funds that track a particular stock index and trade like stock. Actively managed, or so-called “leveraged” and/or “inverse” ETFs, such as the Energy Bear Fund, have exploded in popularity over the last few years, offering investors alternate vehicles to take bullish, bearish, and leveraged positions on popular stock indices. Available in a number of different forms, these ETFs have attracted increasingly significant investor assets.

The Energy Bear Fund seeks investment results that correspond to three times (300%) the inverse (or opposite) of the daily performance of the Russell 1000® Energy Index (“Russell Energy Index”), which fell approximately 11% from November 5, 2008 through April 9, 2009, ostensibly creating a profit to investors who anticipated a decline in the U.S. energy market. However, the Energy Bear Fund actually fell approximately 54% during this.

The Complaint alleges that given the spectacular tracking error between the performance of the Energy Bear Fund and its benchmark index, the fact that Plaintiff and the Class sought to protect their assets by investing their monies on the correct directional play has been rendered meaningless. The Energy Bear Fund is, therefore, the equivalent of a defective product. The Energy Bear Fund did not do what it was designed to do, represented to do, or advertised to do.

Direxion Shares’ Registration Statement did not disclose that the Energy Bear Fund is altogether defective as a directional investment play; it did not track three times the inverse of the Russell Energy Index on a daily basis, nor for periods longer than one trading day. In order to sufficiently and accurately disclose this counterintuitive reality, the Registration Statement would have had to clearly explain that, notwithstanding the name of the Energy Bear Fund, the investment objective of the Energy Bear Fund and the purpose of Direxion Shares’ ETFs generally, the Energy Bear Fund would perform precisely the opposite of investors’ reasonable expectations.

In ignorance of the false and misleading nature of the statements described in the complaint, plaintiff and the other members of the Class relied, to their detriment, on the integrity of the market price of the Energy Bear Fund shares. Had plaintiff and the other members of the Class known the truth, they would not have purchased said shares, or would not have purchased them at the inflated prices that were paid.

If you purchased Energy Bear Fund shares during the Class Period, you may request that the Court appoint you as lead plaintiff by March 15, 2010. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as “lead plaintiff.” Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Wolf Haldenstein, or other counsel of your choice, to serve as your counsel in this action.

Wolf Haldenstein has extensive experience in the prosecution of securities class actions and derivative litigation in state and federal trial and appellate courts across the country. The firm has approximately 70 attorneys in various practice areas; and offices in Chicago, New York City, San Diego, and West Palm Beach. The reputation and expertise of this firm in shareholder and other class litigation has been repeatedly recognized by the courts, which have appointed it to major positions in complex securities multi-district and consolidated litigation.

If you wish to discuss this action or have any questions, please contact Wolf Haldenstein Adler Freeman & Herz LLP at 270 Madison Avenue, New York, New York 10016, by telephone at (800) 575-0735 (Mark C. Rifkin, Gustavo Bruckner, or Derek Behnke), via e-mail at classmember@whafh.com or visit our website at www.whafh.com. All e-mail correspondence should make reference to the Energy Bear Fund or ERY.

Contacts:

Wolf Haldenstein Adler Freeman & Herz LLP
Mark C. Rifkin or Gustavo Bruckner or Derek Behnke
800-575-0735
classmember@whafh.com
www.whafh.com

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