Tag: UCC

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4 Best Long-Term Performance Trading – Leveraged Equity ETFs (2X Only) 1.4

  • Asset Class: Trading – Leveraged Equity

  • Oldest ETF back tested: ProShares Ultra QQQ (QLD)

  • Long-Term Performance: 25.77% CAGR

  • S&P 500 Performance: 10.20% CAGR

  • Correlation to US Stock Market: 0.92

  • Back test timeframe: July 2006 – March 2021

  • Number of ETFs available in this asset class: 87

  • Number of 2X Leveraged ETFs in this asset class that are 10-years old or older: 29

WARNING! Leveraged ETFs are high risk complex financial instruments. Please do not trade or invest in any leveraged product until you thoroughly understand the risks involved. Additionally, all but 12 of the 29 ETFs researched in this article failed to outperform a non-leveraged S&P 500 index fund; meaning that most of these products are simply not worth the risk of holding them for longer than a day or so. They are intended to be used as trading vehicles, not investment vehicles. Buyer beware!

QLD vs SPY: July 2006 – March 2021

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4 Best Long-Term Performance Trading – Leveraged Equity ETFs (2X Only) 1.3

  • Asset Class: Trading – Leveraged Equity

  • Oldest ETF back tested: ProShares Ultra QQQ (QLD)

  • Long-Term Performance: 21.44% CAGR

  • S&P 500 Performance: 8.32% CAGR

  • Back test timeframe: July 2006 – April 2020

  • Number of ETFs available in this asset class: 103

  • Number of 2X Leveraged ETFs in this asset class that are 10-years old or older: 26

WARNING! Leveraged ETFs are high risk complex financial instruments. Please do not trade or invest in any leveraged product until you thoroughly understand the risks involved. Additionally, all but 9 of the 26 ETFs researched in this article failed to outperform a non-leveraged S&P 500 index fund; meaning that most of these products are simply not worth the risk of holding them for longer than a day or so. They are intended to be used as trading vehicles, not investment vehicles. Buyer beware!

QLD vs SPY: July 2006 – April 2020

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Best Long-Term Performance Trading – Leveraged Equity ETFs (2X Only) 1.2

WARNING!  Leveraged ETFs comprise a high degree of financial risk. Please consult a professional investment advisor before investing in any leveraged exchange traded product.

The Deep Value ETF Accumulator Rankings for Trading – Leveraged Equity ETFs:

Source: https://www.morningstar.com/
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Best Long-Term Performance Trading – Leveraged Equity ETFs 1.1

Before I introduce the data on this group of ETFs, I need to point out the fact that leveraged ETFs are designed as trading vehicles and not long-term investments. If you want to know the dangers of these products you need to ‘Google’ this phrase: “leveraged ETF risk”. You will be inundated with article after article with headlines such as:

“Why Leveraged ETFs Are Not a Long-Term Bet”
“Why That Leveraged ETF Is A Bad Idea”
“Why Leveraged ETFs Are Horrible Investments”
“Leveraged ETFs: Why Investors Should Beware”
“Run, Don’t Walk, From Leveraged ETFs”

This sounds scary, right? Well, if you don’t know what you are doing, or you don’t have a strong stomach for volatility, then yes, you should stay away from leveraged ETFs altogether. But, if after reading all the horror stories about leveraged Exchange Traded Products, including my own horror story, you still feel compelled to purchase these investment vehicles, then this article is for you.

As I stated above, you can find many articles that condemn and warn people about using leveraged ETFs. But, if you search long enough and hard enough, you can find articles written by academics that support the use of leverage with mathematics instead of emotion.

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