Do Not Buy Leveraged ETFs Before Watching This Video

We just made a video about the potential dangers of leveraged ETFs, specifically leveraged ETFs that track commodity prices.

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#WallStreetMillenial

[ElliottM-ckwg]

I was up 200% yoloing my whole life savings on a 3x Long ETF, and within a month and a half I lost all my gains due to the underlying stock tanking. Never again... I'd rather have modest, stable returns!

[johanessugiharto]

Thanks mate ... I really appreciate the coverage. I'll adjust my position on BOIL today... Great stuff 👍👍👍🍻🍻

[dhawal]

Great video mate! Not overly positive, not overly negative!

[kahn]

Holding long on SPXL and TQQQ, but I have a high risk tolerance

[djayjp]

Excellent video. Correct on all points. I've often warned of the dangers in leveraged commodities funds as they tend to trade within a range.

Could you do an analysis of buying puts on VIXY as a strategy vs simply buying SVXY?

[sunnycorax]

Agreed commodity leveraged ETFs are poor unless you are playing on a swing or some sort of event or trigger that could cause a sharp price change that the ETF will respond to in the short term.

[highlandspring]

Do normal crude oil ETFs track the exact crude oil price, or are they also manipulated by future traders, and veer away from parity?
Thank you for this very enlightening video. It prevented me from a potentially costly trade.

[JoeyCarb]

Shorted the market on 3x etf as soon as Corona was making headlines in February 2020. Made enough money to buy a brand new f250 in April 20 for 80 cents on the dollar compared to 2019 prices. In January 21 I traded in the f250 for more than I paid.

[tomlxyz]

I'll buy them after watching this video not letting it use change my confirmation bias

[blakeh.]

In the spirit of WSB, I must ask:
Are there any hidden risks in buying multi-year expiration out of the money calls on a 3x leveraged inverse etf of the Russell and/or s&p 500 with the hopes of fishing for a massive single day return during a crash event?

[swedesam]

So, I'm understanding that if commodity price is above the mean, play PUTs, below the mean, play CALLs. However, be aware that there is an absolute decay long term.

[idt]

I bounce in and out of DFEN and LABU on a somewhat regular basis. Done good so far. DFEN i buy when it's <$23.50, sold at $24, $25, &$26 lately, and in LABU I've found the $53 area is a good place to nibble, all the way up to the $56 area and sell accordingly, as high as up to $63 a couple times for me. GLTA!

[nomitzpinky]

Excellent information. Thank you so much!

[ryankane]

Why are we using commodities such as oil in our example for leveraged ETFs? Why not look at some leveraged ETFs that go up as the underlying index or industry goes up?

[nastynate]

the inverse commodity etfs seem to do better than the sqqq

[johanessugiharto]

What's the difference between shorting an invert ETF and the long position on that same sector ETF?
The invert, will be more risky and costly due to interest, isn't?

[NathanParkr]

Anyone reading please help me with this question if you can.
Theoretically, if i hold a x3 SP500 ETF 1 share (100$) like UPRO, SPXL, if that share lost all of its value 100$ would i lose 300$ like using margins like x3 leverage or just 100$ (all i spend on them)?

[defaultemail]

That assumes I invest in crude oil only. That's a cherry picked example

[johnd.]

Technically it's called bag holder ETF aka. Bear shares...lol

[kelmorian]

8 dislikes because they saw this video too late after ETF purchase.