It’s been a busy week for savvy traders with extra doses of volatility in the markets since Monday. Accordingly, there have been significant fund flows in the past week into ETFs that short QQQ, Dow 30 and S&P 500.
Specifically, the ProShares Short QQQ (PSQ) has seen $102.41 million in flows, the ProShares Short Dow 30 (DOG) has seen $13.52 million in flows and the ProShares Short S&P 500 (SH) has seen $11.35 million in flows during the past week, according to XTF.com.
Investors who are seeking a hedge against further weakness in the markets may turn to alternative ETF strategies. For instance, those who want to hedge against risk in the Dow Jones Industrial Average utilized inverse ETFs to bolster their long equities positions. The DOG ETF tries to reflect the -100% daily performance of the Dow Jones Industrial Average. For the more aggressive traders, the ProShares UltraShort Dow 30 ETF (NYSEArca: DXD) takes the -200% of the Dow Jones and the ProShares UltraPro Short Dow 30 (NYSEArca: SDOW) reflects the -300% of the Dow.
For those who were wary of a potential pullback in the S&P 500 index, there are a number of bearish or inverse ETF options with varying levels of leveraged exposure to capitalize off a weakening S&P 500. The SH ETF takes a simple inverse or -100% daily performance of the S&P 500 index. Alternatively, for the more aggressive trader, leveraged options include the ProShares UltraShort S&P500 ETF (NYSEArca: SDS), which tries to reflect the -2x or -200% daily performance of the S&P 500, the Direxion Daily S&P 500 Bear 3x Shares (NYSEArca: SPXS), which takes the -3x or -300% daily performance of the S&P 500, and ProShares UltraPro Short S&P 500 ETF (NYSEArca: SPXU), which also takes the -300% daily performance of the S&P 500.
Lastly, investors also hedged against a dipping Nasdaq through bearish options as well. For instance, the PSQ ETF takes the inverse or -100% daily performance of the Nasdaq-100 Index. For the aggressive trader, the ProShares UltraShort QQQ ETF (NYSEArca: QID) tracks the double inverse or -200% performance of the Nasdaq-100, and the ProShares UltraPro Short QQQ ETF (NasdaqGM: SQQQ) reflects the triple inverse or -300% of the Nasdaq-100.
For more leveraged and inverse ETF plays, visit our Leveraged & Inverse ETF Channel.
