DaddySawbucks

Why Bear Shares are NOT Investments

Education
BATS:SOXS   Direxion Daily Semiconductor Bear 3x Shares
Price of SOXS since inception. Price in 2012 is not a typo.

Adjusted for reverse splits, shares declined from $11.1m to $3.

Eleven million, one-hundred thousand dollars became three dollars in twelve years.

Bear etf funds do not contain equities. They consist entirely of futures contracts, which suffer time decay and expire.

This is the effect of time decay on short sale of futures in a rising market.

Can you make money on SOXS? Sure, if you buy it the day before a crash. Good luck with that!

Other lousy ETFs include UVXY, SPXS, TZA, SDOW, SQQQ.

But Sawbucks, just last month you posted you were buying some of those?!

Yes, you buy them when market is extreme overbought condition and hold for no more than a week.
One day is often long enough.

These are NOT investments, they are purely speculative high-risk instruments. After just a week in these etfs you can notice the time decay, you will see index return to a price it held last week, but the bear fund will be a nickel or even a dime less than it was at the same price.

DO NOT HOLD LONG-TERM!!
Comment:
Just looking at this wondered how it's doing in all this bullishness... got pretty weak eh?

T-bills paying 5% would be a better place for cash imo.
Comment:
Just revisiting this idea to see how SOXS is doing on a really bearish day... unchanged it seems. Because the time ran out of it even though price moved favorably, an investor in this etf got breakeven at best.
Comment:
Flushed it in three green candles. Useless to speculate in this ETF.
Comment:
Market tanked off 5% over a week and this moved 50c.
Yes, adjusted for reverse 1:10 split went 3.60 > 4.10.
During the same time, a $3 qqq put option went 500%.
Time to gtfo imo.
Comment:
See how these lousy ETFs take ur tendies? SPXS is another dog that don't hunt. Even when it dumps these only gain nickels and dimes, when it pumps they piss money away.

In a bull market these are disastrous. It is possible to make something on it, if you buy them at the exact moment before a big flush. That only lasts for a day or two, then they go back in the crapper.

Even in bear markets timing is critical, you lose so fast. You get a 300-pip BTFD rally it just smokes these things. been there, done that, good luck!
Comment:
Smoked, redux. Look how all the bear ETFs melted down.
These might actually print when the upper Bolly band is reached. Soon.
Timing is all.
Comment:
Smoked again. Sorry if you lost, again. Damned bullish!