A deeper look at leveraged ETFs

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[@jakel8627]

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.

[@likeicare300]

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.

[@maxpayne7419]

It’s insane to try to time and short the market

[@sunghopark1390]

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.

[@targetegrat]

Exactly. I convinced my friend to invest in USD short term. He wanted to get into Nvidia but it was too expensive for him.

[@wesjimez2941]

UPRO went from $20 to $60 in 2020.

[@syedarmaghanhassan4652]

Writing/selling Covered calls do not protect an investor from downside risk.😅😅

[@weho_brian]

TQQQ

[@c.white86]

Tqqq And sqqq are definitely the best 3x ETFs

[@FlimsTV]

The best

[@apothe6]

Never heard of that buffer etf

[@Jdiamondhands]

Scalping leveraged etfs