GDXU: Short-Term Gain, Long-Term Pain

Dylan Waller
852 Followers

Summary

  • The MicroSectors Gold Miners 3X Leveraged ETN was launched in December 2020. It is designed to provide 3x the performance of the S-network MicroSectors Gold Miners Index.
  • One very important thing to note, which is included in the ETN prospectus, is that leveraged ETNs are not designed for long-term trading.
  • This is an interesting vehicle for short-term trading and provides more leverage than other 2x leveraged ETFs.
  • However, Junior gold miners are more suitable for long-term investors.
  • Most investors should avoid this ETN.

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MicroSectors Gold Miners 3X ETN Overview

Leveraged products that provide investors with exposure to gold are very popular among retail investors. These investments can produce mixed results for investors and tend to be inferior investment vehicles when

This article was written by

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I am interested in frontier/emerging stock markets and other international markets ( ie. Japan/Korea).  My articles will primarily focus on stocks I am monitoring now based on quality of management/emerging market exposure/valuation.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of GDXJ either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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