Opinions
Mike Philbrick
Horizons BetaPro S&P/TSX 60™ Bear+ ETF
HDX-T
COMMENT
Jun 01, 2020
We have to realize that these are two times levered bear ETFs and have responded exceptionally well with what has happened since February. The challenge with these daily re-balanced bear ETFs is that they have negative expectancy. Were you are wrong in your trade you compound this wrongness. It is a trading vehicle. The one year return on this is -23%. The strategy costs a lot. He'd prefer 7-10 year US bonds as a hedge.
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Would move higher if the Canadian market moved lower. He does not recommend this ETF because it is leveraged. Technical indicators are positive for the TSX presently. Watch the indicators and then play a seasonal trade on a bear TSX. When the election takes place it is an opportunity to go on the bull side instead of the bear side. It is 100 days prior to the election of a new president and is not a great time for the markets as they move lower. This bear ETF could be a good buy when the technical indicators confirm it.
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