Because the buy sell spread of future is much smaller?
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Long TQQQ vs Short SQQQ
- Thread starter GloriaBrown
- Start date
Because the buy sell spread of future is much smaller?
Got bored again so I looked at going long NQ vs shorting SQQQ. I normalized the leverage of NQ based on drawdown.
total log returns trading normally NQ: 353% (40% drawdown)
total log returns shorting SQQQ: 365% (40% drawdown)
(these results are from an overly fitted backtest, not actual profits)
So shorting SQQQ is 3% more profitable per trade than trading futures.
HOWEVER, this does not include fees and more importantly, does not include the much more favorable 1256 tax treatment of futures. You will save at least 10% on taxes in the USA trading futures compared to equities.
I think mainly because 3x etf would up or down as 4x in strong trend days, so if you use max drawdown to control the underly invest value, nq future would have higher underly invest value.
So short 3x etf should be more high risk high return than nq future.
ARKG beats almost all 3x etf in this year
Shorting SQQQ is possibly the best strategy in the world based on my tests.
Anyone agree or disagree?
I agree it is the best for many cases except very short term day trade or buy and hold kind. It would be useful if your cut lose is loose instead of tight for usung the 3x decay benefit.
If you think you have some understanding of it, you can try short SQQQ.
NQ future is better in general for these reasons:
-you can trade almost 24 hours a day, when something happen you can react right away.
-tendy day is like 4x for 3x etf, when this is against you then too hard to control the risk.
-no borrow cost
-buy and sell much lower spread cost
-take too long time to take advantage of the 3x decay while you may need to take the 4x trendy day risk.
-3x backtest result may be far from real
-you can trade almost 24 hours a day, when something happen you can react right away.
-tendy day is like 4x for 3x etf, when this is against you then too hard to control the risk.
-no borrow cost
-buy and sell much lower spread cost
-take too long time to take advantage of the 3x decay while you may need to take the 4x trendy day risk.
-3x backtest result may be far from real
%%ARKG beats almost all 3x etf in this year
True,GB;
but now that you noted it/LOL spxs may do better this week.I dont think the gov failing to pass a gov give away/Fed limits by congress law will hurt it or any longs.
BUT even if ARKG does keep uptrend\ sold my upro,ark ETF............................................
Expecting more market roller coaster by JAN 20 or FEB 1st. NOT a prediction, not anti ark, not a weather prediction/LOL..............................................................................
%%
True,GB;
but now that you noted it/LOL spxs may do better this week.I dont think the gov failing to pass a gov give away/Fed limits by congress law will hurt it or any longs.
BUT even if ARKG does keep uptrend\ sold my upro,ark ETF............................................
Expecting more market roller coaster by JAN 20 or FEB 1st. NOT a prediction, not anti ark, not a weather prediction/LOL..............................................................................
Well when everyone knows it will happen, market may drops when gov really approves.
%%Well when everyone knows it will happen, market may drops when gov really approves.
Last time they shut the gov down /market seemed to like it/ uptrend again.Regardless OF THE DROPS+ last FEB was good one, exspect QQQ to do better than SPY...............................