Opinions
Terry Shaunessy
VelocityShares 3x Long Crude ETN linked to the S&P GSC
UWTI-N
DON'T BUY
Jan 21, 2015
$3.060
Stock price when the opinion was issued
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DON'T BUY
The problem with leveraged ETF’s is that they are actually reset every day. If the stock market moved up and down 10% every day, and a $10 share went up 3 times in a single day, it means it went up 30% and your $10 turns into $13. Next day it falls 10%. That means your $13 times 10% times 3 is going to fall to something like $9.60. The next day it goes back up 10%, but you are only at about $11.50. Your big swings by the day, because of re-balancing, are all over the map.
E.T.F.'s
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Super leveraged oil commodity ETF. It is total speculation. It gets reset every day. This isn’t even investing. Three times the return on Natural Gas to the upside. You are better to go to the futures market.