As you probably know, overtime these stocks which move in multiples of the S&P or Nas lose value. Example SP starts at 100 and SSO starts at 100 SP goes up 10% to 110, SSO goes up 20% to 120. Next day SP goes down 10% to 99, SSO goes down 20% to 98. So overtime if the market goes up and down the SSO will lose value even if the SP goes slightly up or remains the same. So would it be smarter, rather than using inverse ETFs, why not short Long Multiple ETFs? The 3x ETFs would have an even greater loss of value. Input?
I believe this was already answered as not possible or really not a good idea. Reasoning is the way they leverage these 3x ETF's make it towards them being Bull or Bear and you play the one you want. On the other thread someone tried it and it would not go through. TNA BGU = Bull TZA BGZ = Bear
Bullish: BGU: Large Cap Bull 3x Russell 1000 TNA: Small Cap Bull 3x Russell 2000 ERX: Energy Bull 3x Russell 1000 Energy FAS: Financial Bull 3x Russell 1000 Financial Services Bearish: BGZ: Large Cap Bear 3x Russell 1000 TZA: Small Cap Bear Russell 2000 ERY: Energy Bear 3x Russell 1000 Energy FAZ: Financial Bear 3x Russell 1000 Financial Services http://biz.yahoo.com/seekingalpha/081130/108450_id.html?.v=2
What if spy goes does 5% at t=1 spy= 95 sso= 90 then goes up 10% at t=2 spy= 104.5 sso= 108 then sso > spy at t=2