ETFs Leave No Excuse For Unhedged Portfolios (FAZ, SDS, SKF, DXD, QID)

“The current state of the equity markets is one of uncertainty as investors mull attractive valuations and merger hype amid a cautious outlook for the global economy. While indecision can often lead to profitable buying opportunities for retail investors, even the most diversified long-only portfolios can be susceptible to big declines in the event of a broad-based downturn for stocks. The Pros often utilize complex derivative instruments and short-selling strategies to isolate their winning bets while hedging against fluctuation in the benchmarks. Thankfully for amateur investors, there are now a wide variety of exchange-traded funds (ETFs) that can add a degree of simple pullback protection with no margin or options account required,” Jason Smith Reports From Ticker Spy.

Smith goes on to say, “As a whole, the Leveraged ETFs Index is composed of nearly 70 securities designed to place leveraged bets either for or against major benchmarks and a variety of more specific industries. Bearish ETFs, which are designed to track the reverse of a particular sector’s performance, can be used to hedge against systemic risk while maintaining exposure to what traders deem to be opportunistic values. The Direxion Shares ETF Trust Financial Bear 3x (NYSE:FAZ), Ultrashort S&P500 Proshares (NYSE:SDS), UltraShort Financials ProShares (NYSE:SKF), and Ultrashort Dow30 Proshares (NYSE:DXD) are all among tickerspy member favorites, but investors should note that volatile 3x leveraged ETFs are designed for day trading purposes and are recommended for experienced short-term traders only.”

“Investors looking to capitalize on tech stocks with low multiples can pick their winners and pick up shares of the Ultrashort QQQ Proshares (NYSE:QID) to limit the downside risk of a Nasdaq decline. Of course if the markets head higher, the reverse ETF will weigh on aggregate portfolio performance, but in times of uncertainty that may be a small price to pay for potentially limited losses if the opposite scenario comes to fruition,” Jason Smith Reports.

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Feel free to view our categories for each ETF listed in the article for more insight.

  • ProShares UltraShort Financials (NYSE: SKF)  Visit Our (SKF) Category: HERE 
  • Direxion Daily Financial Bear 3x (NYSE:FAZ)  Visit Our (FAZ) Category: HERE
  • ProShares UltraShort S&P500 (NYSE:SDS)  Visit Our (SDS) Category: HERE
  • ProShares UltraShort Dow30 (NYSE:DXD)  Visit Our (DXD) Category: HERE
  • ProShares UltraShort QQQ (NYSE:QID)  Visit Our (QID) Category: HERE

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