Hi guys, I know ETF's have been mistaken by many investors, and apparently myself included. My questions is to why the SP is up 1 % but the FAZ ETF is down 9% today. Shouldn't it be 3-4%. Just a little curious to how this really works. Thank you.
Sorry I wasn't very clear. I have positions in Faz. I meant why is it down 9% when it should be down 3-4%
FAZ is the 3x financial bear etf. It tracks the russell 1000 financial services index not the SP. If the russell 1000 financial index is up 1% the FAZ will be down 3% and the FAS will be up 3%.
You do understand the leveraged results they target are only for the day. If you hold these over a few days you will not achieve the 3x leveraged results.
UPRO is the bull SandP 3X ETF, and SPXU is the 3X bear. Over time these ETFs do not track, they all head to zero. Don't let the charts deceive you, check the historical prices on yahoo.