BIS
(ProShares UltraShort Nasdaq Biotechnology) is an exchange-traded fund
(ETF) managed by ProShares Advisors LLC. The ETF seeks to provide
investors with twice (2x) the inverse (opposite) daily return of the
Nasdaq Biotechnology Index, which is a benchmark that tracks the
performance of biotechnology and pharmaceutical companies listed on
the Nasdaq Stock Market.
As a leveraged inverse ETF, BIS uses
financial derivatives and other investment strategies to amplify the
daily inverse returns of the underlying index. This means that if the
Nasdaq Biotechnology Index falls by 1% on a given day, BIS should
deliver a return of 2% (before fees and expenses) in the opposite
direction. However, if the index rises by 1%, BIS would be expected to
deliver a loss of 2%.
As of September 2021, the BIS ETF had
total net assets of around $180 million and was invested in a
diversified portfolio of inverse derivative securities, primarily
focused on the Nasdaq Biotechnology Index. The fund's top holdings
included inverse securities from companies such as ProShares,
Direxion, and Rafferty Asset Management.
In terms of
performance, BIS has been relatively volatile over the long term, with
significant swings in both directions. While it can be used to hedge
against market downturns in the biotechnology and pharmaceutical
sectors, investors should keep in mind that leveraged inverse ETFs
like BIS can be highly volatile and carry significant risks.
Additionally, the ETF charges a relatively high expense ratio of
0.95%, which is higher than the average expense ratio for ETFs in the
biotechnology sector. Investors should carefully consider their risk
tolerance and investment objectives before investing in BIS or any
other leveraged i
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