Direxion Daily TSLA Bull 2X Shares (TSLL), an exchange-traded fund that offers leveraged exposure to Tesla stock, surged 8.25% in pre-market trading on Friday. The significant jump comes in response to Tesla's announcement of a groundbreaking new compensation package for CEO Elon Musk, potentially worth up to $1 trillion over the next decade.

Tesla's board of directors has proposed an ambitious pay plan that would grant Musk substantial stock awards if the company achieves a series of challenging milestones. These targets include growing Tesla's market capitalization to $8.5 trillion, reaching $400 billion in adjusted EBITDA, and hitting production goals of 20 million vehicles. The proposal aims to keep Musk focused on Tesla's long-term growth and expansion into artificial intelligence and robotics.

The leveraged nature of TSLL amplifies the movement of Tesla's stock, explaining the outsized 8.25% gain compared to Tesla's more modest pre-market increase. Investors appear optimistic that the new compensation structure will motivate Musk to drive Tesla's growth and innovation, potentially leading to significant gains for shareholders.

Tesla shareholders will have the opportunity to vote on this proposal at the company's annual meeting scheduled for November 6. The market's initial reaction suggests strong support for the plan, as reflected in the substantial pre-market rally of TSLL. However, investors should be aware that leveraged ETFs like TSLL carry higher risks and are primarily designed for short-term trading rather than long-term holding.