Brad Zigler

More Silver Linings

I think you'll find the leveraged ETFs and ETNs more tactically useful as hedges or short-term exposures because of the compounding effect. As long term holds, the returns on the unlevered products will tend to mirror more closely the gains and losses realized by the underlying metal or futures.

That said, there'll be a drag on each product for its management/investment fee. In the case of SLV, the fee's subsidized by bullion sales, so there's a niggling erosion in the asset base.

For the futures-based products, there's the contango cost, too. When there's a big spread between the delivery month prices, the drag on returns gets heavier.


On Jan 07 08:41 AM adan wrote:

> great info
>
> there's been articles lately too on how well one can do w/some of
> the etf's as a trading vehicle vs longer term holding
>
> maybe some follow ups in the future?
>
> thanks!