ProShares exchange traded funds (ETFs) are mainly associated with leveraged ETFs. These ETFs offer three different investing strategies: ultra, short or ultrashort.

  • Ultra – The ultra tries to produce twice the returns of an index, regardless of whether it goes up or down.
  • Short – The short aims to replicate the the opposite of how an index performs. So if an index goes down 5%, a ProShares short ETF goes up 5%.
  • Ultrashort – The third kind is the ultrashort strategy. The ultrashort seeks to perform double the opposite of an index. So if the index goes down 5%, the ETF goes up 10%.

Short and ultrashort ETFs tend to be popular when markets are down or turbulent. In fact, these ETFs are so well-liked by investors that Profunds Group announced today that its ProShares ETFs passed the $7 billion mark after being available for a little more than a year, according to Carl Delfeld for ETF XRAY.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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