Opinions
Stan Wong
ProShares UltraPro QQQ
TQQQ-Q
DON'T BUY
Nov 16, 2023
Stock price when the opinion was issued
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ZQQ-T vs. TQQQ-N. The question is if you buy it with a currency hedge or the US version. If you are holding for the next few years, the Canadian dollar will be stronger down the road. He would prefer the ZQQ-T version but today is not the day to buy. In the next market decline he thinks some of the tech stocks will get hit.
The ticker here is TQQQ, so think of this as QQQ on steroids. QQQ is the ETF that tracks the Nasdaq. TQQQ tracks several Nasdaq 100 indicies including those from Goldman Sachs, Societe Generale, BNP Paribas and Citibank; throw in Apple, Amazon and Microsoft for good measure. Though it pays no dividend (no surprise), TQQQ returns three times as much as QQQ. On the other hand, TQQQ has a beta of 3.34. In other words, when tech rallies, TQQQ soars three times higher, but when tech sinks, TQQQ tumbles three times lower. TQQQ is strictly for those who firmly believe in tech and who can stomach this ETF's risk.
TQQQ gives you performance that's 3x the daily (an important distinction) performance of the NASDAQ 100, magnified returns and magnified risk. Be very cautious of this strategy.
QQQ gives exposure mostly to tech, and larger weightings in the Magnificent 7. He owns some of those names, but he's very cautious of owning the broader tech index, as valuations are extended.