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<p>[QUOTE="GoldFinger1969, post: 4348443, member: 73489"]Leveraged ETFs don't work over longer periods of time -- say months for sure but maybe even weeks during periods of hyper-volatility (i.e, March 2020) -- because of time decay. You have to buy more-expensive futures contracts and sell lowe-priced near term futures.</p><p><br /></p><p>You also have a math problem: lose 50%, gain 50%, you're still down 25%.</p><p><br /></p><p><b><u>That said...IF YOU KNOW WHAT YOU ARE DOING...and can't or don't want to raise cash (maybe you have a taxable account)....you can buy inverse ETFs and/or inverse leveraged ETFs and use them to hedge</u></b>.</p><p><br /></p><p>I used to use them alot in 2005-09 and the only time I went "short" against the market was in November 2009. Made a quick 8% on portfolios in 2 days using the leveraged ETFs. </p><p><br /></p><p>Funds run by perma-bears like David Tice in the 1990's and 2000's could not be held profitably for more than a few months for the most part. That's what I meant.[/QUOTE]</p><p><br /></p>
[QUOTE="GoldFinger1969, post: 4348443, member: 73489"]Leveraged ETFs don't work over longer periods of time -- say months for sure but maybe even weeks during periods of hyper-volatility (i.e, March 2020) -- because of time decay. You have to buy more-expensive futures contracts and sell lowe-priced near term futures. You also have a math problem: lose 50%, gain 50%, you're still down 25%. [B][U]That said...IF YOU KNOW WHAT YOU ARE DOING...and can't or don't want to raise cash (maybe you have a taxable account)....you can buy inverse ETFs and/or inverse leveraged ETFs and use them to hedge[/U][/B]. I used to use them alot in 2005-09 and the only time I went "short" against the market was in November 2009. Made a quick 8% on portfolios in 2 days using the leveraged ETFs. Funds run by perma-bears like David Tice in the 1990's and 2000's could not be held profitably for more than a few months for the most part. That's what I meant.[/QUOTE]
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