SpaceX's (NASDAQ: SPCX) leveraged ETF ecosystem is having a rough week. Several 2X products have fallen more than 6% as investors work through weakness in SPCX ahead of the company's next big Starship test.

The Defiance Daily Target 2X Long SpaceX ETF (BATS: SPCU) is down 6.5% this week. The ProShares Ultra SpaceX (NYSE: SPCF) has declined 6.6%. And the Direxion Daily SpaceX Bull 2X (NYSE: LOFF) has fallen 6.7%, based on market data through Friday.

That's the thing about leveraged products. All three ETFs aim for roughly 2X the daily performance of SpaceX, before fees and expenses. When the underlying stock wobbles, these things don't just wobble. They lurch.

If you want the other side of the trade, there's the Direxion Daily SpaceX Bear 2X ETF (NYSE: LOFD), which targets twice the inverse of SPCX's daily performance. It's up 5.4% this week.

Why the ETF Losses Can Dwarf SPCX's Own Decline

This week's action is a nice reminder of why daily leveraged ETFs can behave very differently from their underlying stocks over longer stretches.

Over the past three months, SPCX has declined about 2.7%. Meanwhile, LOFF is down roughly 20.6%, SPCU is down 21.1%, and SPCF is down 21.3%.

That gap isn't necessarily a tracking failure. Leveraged ETFs reset their exposure every trading day, so daily compounding and volatility can cause returns over weeks or months to diverge significantly from simply multiplying the underlying stock's cumulative return by 2.

This dynamic matters even more with a relatively young and potentially volatile stock like SpaceX.

Starship 14 Could Pour Fuel on the Fire

The ETF weakness arrives just ahead of Starship Flight 14, which SpaceX is targeting for Sep. 28, subject to regulatory approval.

That gives SPCX investors a fresh company-specific catalyst after a stretch of weakness. Any sharp move in SpaceX could translate into a substantially larger one-day move in the leveraged ETF products.

Here's a quick example. A hypothetical 5% decline in SPCX in a single session would correspond to a roughly 10% decline in a 2X long ETF before fees, expenses and tracking differences. The reverse would apply during a 5% gain.

Shotwell's $52.5M Sale Adds to the Spotlight

Against that backdrop, SpaceX President and COO Gwynne Shotwell sold 342,170 shares worth approximately $52.55 million on Tuesday, according to an SEC filing.

The shares were sold across five transactions at prices between roughly $151 and $155. Importantly, the transaction was executed under a Rule 10b5-1 trading plan adopted June 23, meaning the sale had been pre-arranged.

So Shotwell's transaction provides some additional context around SpaceX's shares. But the more immediate ETF story is the sharp decline in the leveraged products and the potential for further amplified moves as Starship 14 approaches.

For traders watching the SpaceX ETF complex, the coming week could put the daily-reset leverage mechanism to another significant test.