Hey Stoney - Do you know if there's anybody pairing up leveraged ETFs with their tracking indexes and profiting off the difference? Everything I've read recently has been that over the long-term, leveraged ETFs significantly underperform the multiplier of their index fund that they're tracking. Basically in a choppy market the leveraged downside outweighs the leveraged upside. Soo... (you can probably see where I'm going with this) If you were to short 100 shares of BGU (3x the Russell 1000), and buy 300 shares of IWB (Russell 1000) you should have the potential to make the difference with no upside risk, correct?
Note, I'm no trader (just an investor so I wouldn't be messing with this) but was lying in bed wondering why this wouldn't work and I couldn't come up with a reason. Is it just that the amount wouldn't be that great and the ROI would pretty much not be worth the it? Just curious...
Note, I'm no trader (just an investor so I wouldn't be messing with this) but was lying in bed wondering why this wouldn't work and I couldn't come up with a reason. Is it just that the amount wouldn't be that great and the ROI would pretty much not be worth the it? Just curious...