Discussion in 'ETFs' started by crgarcia, Dec 10, 2008.
Have heard they use swaps in addition to futures.
How they do it, exactly?
Googled and found this on Fools.com:
How do these things really work?
Leveraged ETFs resemble regular index ETFs in that they're geared to track the returns of a given market index. To generate ramped-up returns, however, most leveraged ETFs invest in a combination of stocks and derivatives, including options, futures, and swaps. For instance, the ProShares Ultra QQQ ETF, which tracks the Nasdaq 100 index, holds a combination of swaps and futures contracts in addition to shares of Apple (Nasdaq: AAPL), Microsoft (Nasdaq: MSFT), and Qualcomm (Nasdaq: QCOM).
Separate names with a comma.