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RSW

Given the impressive pace of expansion in the ETF space in recent years, SEC filings detailing ideas for new products have become commonplace. There are currently hundreds of ETFs at various stages of the registration process, including active ETFs, esoteric quant-based products, and just about anything an investor could dream up. But a recent filing came as a bit of a surprise, not so much because of the funds outlined, but because of the firm making the filing: Rydex, the Maryland-based firm perhaps best known for its currency products, recently filed details on 19 proposed ETFs [see Ten ETFs That Don't Exist, But Should]. [click to continue…]

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Why Everything You’ve Heard About Leveraged ETFs Is Wrong

by Michael Johnston on August 4, 2009

Leveraged ETFs have been in the news a great deal lately, although the majority of the coverage has been less than flattering. Over the last week, several prominent financial institutions have ceased purchasing leveraged ETFs on behalf of their clients, citing the incompatibility of the short-term nature of these products with their long-term views on investing. Moreover, the returns that these products generate in certain markets have been criticized as misleading and even dishonest, implying that leveraged ETFs are some sort of a scam designed to rip off hard-working, middle class investors. Enough is enough. It’s time to dispel a lot of the myths surrounding leveraged ETFs that have been circulating in recent weeks. Like almost any investment, leveraged ETFs can be used inappropriately. But if used appropriately (and there are a lot of investors who are doing so), these products can be extremely powerful and efficient investment vehicles. [click to continue…]

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