Do the 1x inverse ETFs decay the same as the 2x and 3x?

Discussion in 'ETFs' started by IronFist, Nov 18, 2009.

  1. I know the weighted ETFs are designed to match the DAILY performance of the indices and how they decay over time, etc.

    What about the 1x inverse ETFs like PSQ? Will it be exactly the inverse of QQQQ over the long term? Or does it somehow decay as well despite not being weighted?
  2. Chagi


    I posted a few weeks back about this...yes, the 1x inverse ETFs will decay, just not as badly as the 2x ETFs. I would suggest plunking some numbers into Excel to simulate volatility and compare to 2x (e.g. how much does something decay if it moves +3.00% -2.50% + 2.80% vs. 1.50% -1.25% + 1.40% over a few days).
  3. Lame.

    Alright, thanks.