Comments on: Leveraged ETFs: Where ETF Decay Rules http://youngandinvested.com/young-finance/leveraged-etfs-where-etf-decay-rules/ THE hub for finance and investing insights from the new generation. Sun, 13 Jun 2010 22:30:47 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Y&I’s Vision for 2010 | Young and Invested http://youngandinvested.com/young-finance/leveraged-etfs-where-etf-decay-rules/comment-page-1/#comment-901 Y&I’s Vision for 2010 | Young and Invested Fri, 22 Jan 2010 04:59:29 +0000 http://youngandinvested.com/?p=628#comment-901 [...] inquisitive minds looking to put themselves on the map. We love brining new perspectives such as these to our community. We invite people with a deep interest in finance and investing to contribute, [...] [...] inquisitive minds looking to put themselves on the map. We love brining new perspectives such as these to our community. We invite people with a deep interest in finance and investing to contribute, [...]

]]> By: Leonard Anthony http://youngandinvested.com/young-finance/leveraged-etfs-where-etf-decay-rules/comment-page-1/#comment-893 Leonard Anthony Mon, 18 Jan 2010 14:45:26 +0000 http://youngandinvested.com/?p=628#comment-893 Wow that is a great point, thanks for pointing that out! I'll be back again soon, I hope to see some more great content in the future from you! Wow that is a great point, thanks for pointing that out! I’ll be back again soon, I hope to see some more great content in the future from you!

]]> By: Quantum Fading » Leveraged ETF News 14 http://youngandinvested.com/young-finance/leveraged-etfs-where-etf-decay-rules/comment-page-1/#comment-825 Quantum Fading » Leveraged ETF News 14 Wed, 06 Jan 2010 04:00:23 +0000 http://youngandinvested.com/?p=628#comment-825 [...] 12/29/2009 Best and Worst Leveraged / Inverse ETFs of 2009 (seekingalpha.com) 12/23/2009 Leveraged ETFs: Where ETF Decay Rules (youngandinvested.com) 12/20/2009 Top 10 Performing Leveraged ETFs of 2009 (seekingalpha.com) [...] [...] 12/29/2009 Best and Worst Leveraged / Inverse ETFs of 2009 (seekingalpha.com) 12/23/2009 Leveraged ETFs: Where ETF Decay Rules (youngandinvested.com) 12/20/2009 Top 10 Performing Leveraged ETFs of 2009 (seekingalpha.com) [...]

]]> By: Jonathan Edwards http://youngandinvested.com/young-finance/leveraged-etfs-where-etf-decay-rules/comment-page-1/#comment-784 Jonathan Edwards Tue, 29 Dec 2009 20:35:17 +0000 http://youngandinvested.com/?p=628#comment-784 To minimize the negative effect on your return, leveraged ETF's should ideally only be used intra-day (as most ETF's are designed to track the daily returns of a basket of stocks). For investors who do not have the capacity for high volume trading but want to take advantage of a leveraged position, a few days may be appropriate if you expect a flat to upward-trending market. A longer position may be held to gain greater gains as the market rises, but investors should understand a portion of their expected return will be decayed in the process. Leveraged ETF's are a balance between greater exposure and time. While using these types of investments can lead to stronger returns, there may very well be another strategy with the same expected return, but lower risk. To minimize the negative effect on your return, leveraged ETF’s should ideally only be used intra-day (as most ETF’s are designed to track the daily returns of a basket of stocks). For investors who do not have the capacity for high volume trading but want to take advantage of a leveraged position, a few days may be appropriate if you expect a flat to upward-trending market. A longer position may be held to gain greater gains as the market rises, but investors should understand a portion of their expected return will be decayed in the process.
Leveraged ETF’s are a balance between greater exposure and time. While using these types of investments can lead to stronger returns, there may very well be another strategy with the same expected return, but lower risk.

]]> By: Daniel Eskin http://youngandinvested.com/young-finance/leveraged-etfs-where-etf-decay-rules/comment-page-1/#comment-779 Daniel Eskin Tue, 29 Dec 2009 01:21:04 +0000 http://youngandinvested.com/?p=628#comment-779 Great article Jon. I've experience a similar decay in the past when dealing with contango on some oil ETF's (I actually think it was HOU) - maybe not the same source but I can relate to what you mentioned about the expected return needing to account for decay on the ETF as well. When you say leveraged ETFs should be used simply for short-term trading - can you clarify on how short exactly? Great article Jon. I’ve experience a similar decay in the past when dealing with contango on some oil ETF’s (I actually think it was HOU) – maybe not the same source but I can relate to what you mentioned about the expected return needing to account for decay on the ETF as well.

When you say leveraged ETFs should be used simply for short-term trading – can you clarify on how short exactly?

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