May 23, 2008 at 1:00 pm by Tom Lydon
While the Dow Jones industrial average and other major indexes sank in trading today, exchange traded funds (ETFs) that short the markets reaped the rewards.
The strongest 20 ETFs in trading today were all funds that short the market. Sitting near the top were:
- ProShares UltraShort FTSE/Xinhua China 25 (FXP), down 12.4% year-to-date
- ProShares UltraShort Basic Materials (SMN), down 28.2% year-to-date
- ProShares UltraShort Oil & Gas (DUG), down 24.4% year-to-date
- Rydex Inverse 2x Russell 2000 (RRZ), u 3.7% year-to-date
- Rydex Inverse 2x S&P 500 (RSW), up 6.5% year-to-date
- ProShares UltraShort Semiconductors (SSG), up 0.6% year-to-date
- ProShares UltraShort MSCI Emerging Markets (EEV), down 13.2% year-to-date
Leveraged and short ETFs are among the fastest-growing segments of the ETF industry. They were first introduced in June 2006, but by the end of January of this year, there were 60 such funds on the market.
If you decide these funds are right for you, just know the risks and have your exit strategy in place.
Read the disclosure, as Tom Lydon is a board member of Rydex Funds.
Tags | Asia, China, Dow Jones Industrial Average, Emerging Markets, Energy, Gas, Material ETFs, Oil, S&P 500, Technology
