If you're sensible enough to buy FAS at a short-term bottom you would have never bought FAZ near it's short-term top.
FAS for a long term account is still aggressive, truthfully, i hate the financials and would say if you want to get involved in something of that nature, you're probably better off buying BGU
Not necessarily... shorting both makes money in churning markets and loses in directional moves. Had you shorted both from late Feb until a few days ago you would have had your head handed to you.
Then the original suggestion - buying FAS and holding on for a long term big bull move - has merit. It may not be the promised 3x-banger but it should be very positive regardless if the move develops as envisaged.
If the Russell 1000 Financial Services Index STEADILY increases for YEARS, yes. But a few large down moves or a lot of churning along the way could kill it. If you model how leveraged ETFs are priced you'll see that different price paths will result in different ending values of the leveraged ETF, even if the ending values of the underlying are the same.
Add to that the fact that ETFs have to distribute gains annually. Worst case would be to buy more shares with the distributed gains then get hammered in the following year. The net, due to additional shares, is an amplified down move.
I am an investor over the long term in the FAZ for my IRA. It has done nothing but go up since the start of the year.
It's already given back 70% of that gain the past 3 days. What are you waiting for, to break the $37.82 swing low?