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BGU

Leveraged ETFs are among the most actively-traded securities on any market in the world today, with some turning over several times daily and maintaining average investor holding periods of less than an hour. And their popularity appears to be on the rise, as these funds regularly top the list of monthly ETF inflows released by the National Stock Exchange. The amount of interest in these funds certainly isn’t surprising – the temptation to double or even triple the daily returns of a well-known benchmark is tempting, especially for day traders who make their living moving in and out of positions with a frequency that would make most buy-and-hold investors faint. But to generate amplified returns, leveraged ETFs utilize a number of complex strategies that don’t always ensure perfect results. But just how close do they come? [click to continue…]

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With last week’s announcement that ProShares has requested that the SEC allow it to provide up to 300% leverage and 300% inverse exposure to 37 different indices, it has become apparent that despite a generally risk-averse economic environment, leveraged ETFs are enjoying a tremendous surge in popularity. In November, rival ETF sponsor Direxion made the jump from 200% coverage, the previous high among levered ETFs. These securities may seem like a golden ticket to an early retirement, but before you go plowing your nest egg into BGU or TNA, let’s take a deeper look at how these funds actually work [see Free Report: How To Pick The Right ETF Every Time]. [click to continue…]

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