March 19, 2008 at 6:00 am by Tom Lydon
Investors are increasingly less content do just sit there holding cash while the market tumbles, giving short exchange traded funds (ETFs) a measure of popularity. The trend has been especially popular this year as each week seems to bring only more bad news. There’s no telling when things will turn around, say investors, so why not turn lemons into lemonade?
ProShares is a leading provider of the short fun. The firm has seen more than $4 billion flow into its offerings this year, one of the largest tallies in the industry, reports Rob Wherry of Smart Money.
As the next few weeks are anticipated to be rough ones for Wall Street, some investors are taking advantage of these vehicles to keep their balances from shrinking. While many want to try and take advantage of these funds for the current market conditions, use them with caution. The risks when there’s a turnaround are great.
A few of the short ETFs available are:
- ProShares UltraShort S&P 500 (SDS): up 22% this year. This strategy can help offset risk, keep taxes to a minimum, and protect principal.
- MacroShares Oil Up (UCR): up 55%; may be used as a tax hedge.
- ProShares Short QQQ (PSQ): up 18.8% year-to-date; posts the inverse return on the Nasdaq’s 100 largest non-financial stocks.
March 20th, 2008 at 3:57 am
The ultra short qubes is QID I believe not QQQQ. There is a short qube but I don’t have the symbol available
March 20th, 2008 at 7:55 am
Thank you, Frank. It’s been fixed!