Analyste de Boston

Investors Fled out of Leveraged ETFs at Exactly the Wrong Time

This is nonsense, propaganda from the managers, shills, salesguys for NON-leveraged products. And the ignorant.

Agree with the author's premise that 'we have had a strongly trending bull market' and leveraged Bullish ETFs were an excellent tool for savvy investors in the past 4 months. However, practically ALL the money in leveraged ETFs is INSTITUTIONAL - professionals.

Another way to see the big players bailing on these 2x-3x bull ETFs? The great Bull run may be slow, halting, or reversing : is this the point or pivot, the moment to reduce risk? Time will tell if that's correct, premature or simply wrong.

The next wave of deleveraging will probably witness 'bank holiday' restrictions, and wouldn't you imagine leveraged short ETFs will be closed to retail investors then?


On Sep 13 08:34 AM Brian O'Flanagan wrote:

> in the long run, the value of all leveraged ETFs will go to zero.
> They are never an appropriate investment for anybody with a holding
> period longer than 1 day.

FINRA Has Firms Scrambling: Morgan Stanley Next to Review Leveraged ETFs

"Is there some other underlying theme, other than investor education, that would warrant these firms to remove such a valuable trading tool from investor’s hands?"

Don't you mean to write "...other than CYA..." ? FINRA has all but encouraged investor lawsuits, with its highly prejudiced finding that oh-so-conveniently supports the biggest & baddest ETF critics: the Mutual Fund companies. This isn't an objective affair.

Please note that FINRA negatively commented on BOTH leveraged AND short ETFs. They conflated two separate strategies: why shouldn't an investor short the market with ETFs for "more than one day," again? Equity fund managers don't like these ETFs, that's why.