Ultra ETF Shorting Opportunity

[Bond]

What happens with Ultra ETF's (leveraged) like sso, ddm, uyg? Once the market gets halved they should be at 0 This ETF situation leads me to believe the market will at least be cut in half, because of this shorting opportunity. Just an observation that just occurred to me.

 

[cszulc]

They follow the inverse DAILY performance x 2 to the market.

The Dow could keep losing 10% everyday and its UltraLong constituent would lose approximately 20% everyday. Keeps on going and going.

Doesn't track the index directly over long-term, but the DAILY performance. Same with the UltraShort ETFs.

 

[andrasnm]

for every long etf there is a short equivalent - for the dow there is
the SIJ - UltraShort Industrials ProShares, and so on.
There is no need to short anything....

Quote from Bond:

What happens with Ultra ETF's (leveraged) like sso, ddm, uyg? Once the market gets halved they should be at 0 This ETF situation leads me to believe the market will at least be cut in half, because of this shorting opportunity. Just an observation that just occurred to me.

 

[Bond]

Thanks for the clarification, I was questioning the efficiency of the leveraged etf's and now I see that they do work efficiently.