A leveraged exchange-traded fund (ETF) is a complicated, enhanced-risk investment that few people understand, including often the people buying it. Possibly even the people selling it. Even if you have no interest in them, their growing popularity says a lot about today’s investor attitudes about risk – and that’s something that affects everyone with an IRA or 401(k).

A typical leveraged ETF borrows against its investor equity or uses derivatives to amplify daily returns, commonly aiming to double the daily return of an underlying asset. For example, the goal of the Direxion Daily TSLA 2X Shares ETF is to produce twice the return of Tesla shares. So far this year, Tesla stock has increased a little more than 12%, so you might expect that a fund aiming to double Tesla’s stock return would be up 24%. But it isn’t. The Direxion fund that is supposed to double the return of Tesla shares has actually declined 28% this year. Surprise!

The biggest reason for the decline in the leveraged ETF is simple algebra. (Fees also play a much smaller role.) The leveraged returns of the ETF are calculated as percentages on a changing base. It is the subtle but critical difference between geometric and arithmetic averaging. Don’t be embarrassed if you can’t immediately explain the difference; neither can many of the investors scratching their heads, wondering how their 2X bullish Tesla investment lost a quarter of its value when the underlying stock price increased.

And that is what should concern all investors, even those with no interest in a leveraged ETF.

There is a growing investor appetite for risk—and much of that increased appetite is misinformed or uninformed. Fund sponsors are happy to profit from this demand: the number of leveraged ETFs has increased 40% this year. Not content to assist investors in the slow erosion of their money, ETF issuer Volatility Shares is about to launch a fund that will help investors do it much more quickly. Not content to help investors lose money slowly, ETF issuer Volatility Shares is about to launch a new fund leveraged 5-to-1 that should speed the process considerably. This means that if the underlying asset increases 10% on a given day, the fund should increase 50%. But on any day the underlying asset declines 20%, the fund will decline 100% and be shut down; investors will lose all of their money.

Snake oil salesmen don’t peddle products they think will benefit you. They prey on human emotion—whether it’s fear or greed. And they prey on people who don’t heed Warren Buffett’s advice to be greedy when others are fearful, and fearful when others are greedy.

David Moon is president of Moon Capital Management. A version of this piece originally appeared in the USA TODAY NETWORK.