Feb. 12 at 7:40 PM
Most people don’t hold 3X funds long term. while there is decay there is also compound returns. As you can see in the chart.
3X etfs only make money in low volatility markets. We are currently in a low volatility market with indices showing little reaction to news and such.
So I thought I should mention that. Morning star has probably the bests finance teams in the game for the long term. If I was a daytrader I wouldn’t use morning star.
But long term holds are what they do and they gave SOXX a 5 star bronze upped form 4 stars in January. So that tells me we are in a low volatility market at least for semiconductors. So we should expect amplified gains. We can see a 5-15% pull back on any given day, like today for example but the gains are amplified due to the markets going up. So there is less risk according to morning star for this sector.
$SOXL $SOXX