It's dumb to discuss the pros and cons of leverage etfs w/o discussing trade size. Why people assume we go all in leveraged etfs??? Crazy?? Accumulate to 30% of your account into 3x etfs. Then, rebalance to keep it at 30%. Then, adjust a little based on seasonality (ex, keep it around 35-40% from late oct to may & move to non leveraged etf beginning september). Also, when volatility is high, switch to lower leveraged or non leveraged etfs. Then, see what happens. I made small profit trading soxl last yr. At one point even last yr, soxl was down 78% at one point, but i was doing ok as i moved to spy. When someone says he trades leveraged etf, it doesn't mean they r in 100% in like upro for 100% of the time. Then, all of the issues in this video happen.
A common argument against leveraged ETFs is this. The S&P500 goes down 10% and then back up 11%, leaving you with exactly the same amount you invested. The problem with leveraged ETFs is you're left with around a 7% loss because of rebalancing. Doesn't this also work in reverse? If the S&P500 goes up 10% and then loses the same 10%, shouldn't the leveraged ETF be left with a positive return? Edit: Been some time since posting this and based on what I've learned they're not worth holding long-term. The daily compounding eats away at the gains.
If you back test SSO vs SPY then you will find out that leveraged is better. The risk is that things are flat for a prolonged period of time either without or after a crash.
It’s insane to try to time and short the market
UPRO went from $20 to $60 in 2020.
It's dumb to discuss the pros and cons of leverage etfs w/o discussing trade size. Why people assume we go all in leveraged etfs??? Crazy?? Accumulate to 30% of your account into 3x etfs. Then, rebalance to keep it at 30%.
Then, adjust a little based on seasonality (ex, keep it around 35-40% from late oct to may & move to non leveraged etf beginning september). Also, when volatility is high, switch to lower leveraged or non leveraged etfs. Then, see what happens. I made small profit trading soxl last yr. At one point even last yr, soxl was down 78% at one point, but i was doing ok as i moved to spy. When someone says he trades leveraged etf, it doesn't mean they r in 100% in like upro for 100% of the time. Then, all of the issues in this video happen.
Exactly. I convinced my friend to invest in USD short term. He wanted to get into Nvidia but it was too expensive for him.
A common argument against leveraged ETFs is this. The S&P500 goes down 10% and then back up 11%, leaving you with exactly the same amount you invested. The problem with leveraged ETFs is you're left with around a 7% loss because of rebalancing.
Doesn't this also work in reverse? If the S&P500 goes up 10% and then loses the same 10%, shouldn't the leveraged ETF be left with a positive return?
Edit: Been some time since posting this and based on what I've learned they're not worth holding long-term. The daily compounding eats away at the gains.
Still better returns than non leveraged though. So up to the investor. If your dca for the next 40 years it's not a bad idea.
If you back test SSO vs SPY then you will find out that leveraged is better. The risk is that things are flat for a prolonged period of time either without or after a crash.
Never heard of that buffer etf
Writing/selling Covered calls do not protect an investor from downside risk.😅😅
TQQQ
Tqqq And sqqq are definitely the best 3x ETFs
The best
Scalping leveraged etfs