Does shorting/buying leveraged ETF pairs work? (because of the decay)

Discussion in 'Trading' started by Newmoney24, Apr 3, 2013.

  1. This is an interesting idea I saw about a year ago, some were skeptics, but looking at this again, I am curious if it would work,
    why or why not?
  2. mktforecast

    mktforecast ET Sponsor

    You could try simulating how a levered ETF would have performed over the past 50 years.. and try simulating the strategy you mention.. my guess is you'll find that you sometimes get blown out of the water, even though if you simulate the strategy over the period where the etfs existed you'd likely seem to be fine (which is probably why some people think it works).

  3. boffster


    it doesn't work because no one will lend you the leveraged etf to short

    try shorting one yourself if you don't believe me
  4. kroponer


    hard to borrow