Note leveraged mutual funds aren't the same as leveraged ETFs -- they're basically like regular mutual funds, with once a day end-of-day pricing, but use leverage.
#1 They track their index very well: "because these funds (unlike ETFs) track the underlying index so closely, I can designed my strategies using index data (such as from the S&P 500) rather than a specific fund. This is important because more data means a potentially more robust solution."
#2 They don't have per-trade transaction costs: "many of the advantages we trade are so small, that trading friction (i.e. execution costs and slippage) would effectively kill them. Having no per-trade costs means that we can pursue short-term swing trades that might not be available to other traders."
#3 They can scale well for different amounts of money: "Another advantage of no per-trade transaction costs is that every account we manage achieves more or less the same results regardless of account size. The young investor placing $25k gets the same benefit as the financial advisor placing $25m. Call me a softie, but to me that just seems right."
#4 They are leveraged to their benchmark index returns: "during those less-common times where our models believe a real competitive advantage exists, I want to be able to throw leverage at that day to maximize the impact on the portfolio."
#5 They are priced only once a day, so are 'Fire and Forget': "I spend very little time actually trading (about 10 minutes a day to be exact). Leveraged mutual funds work well for me because I can make my trades, walk away, and do something more fun than wondering where the next tick on the market is going."