UPRO - Use SPYU's 4x Leverage Tactically To Boost Your Portfolio's Risk/Reward Substantially

2024-06-26 08:07:25 ET

Summary

• You've likely heard of 3x Leveraged ETFs - welcome to SPYU, the first 4x levered ETN that tracks the S&P 500.
• The extreme leverage employed by this fund immediately disqualifies it as a long-term investment vehicle due to the potential for permanent capital impairment.
• However, the built in volatility is interesting from a portfolio construction standpoint.
• Today, we design a strategy using SPYU that could potentially outperform the market by more than double, while removing risk at the same time.

Last week, we wrote an article about TQQQ , the ProShares UltraPro QQQ ETF, titled: "TQQQ: Two Ways To Tame The Volatility And Capture Far More Upside".

The thrust of the article was that the fund was likely a good way to capture broader appreciation in the market over the long haul, IF , and only IF , one was willing to position tactically, reacting to changing market conditions to prevent massive drawdowns and other nasty surprises....

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