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SPXU - Ultrapro Short S&P500 -3X ETF

Ultrapro Short S&P500 -3X ETF logoThe Ultrapro Short S&P500 -3X ETF (SPXU) is an exchange-traded fund (ETF) that seeks to provide investors with three times the daily inverse performance of the S&P 500 Index. The ETF's objective is to provide investors with leveraged exposure to the US equity market, but in a way that profits from declining prices.

SPXU invests in a portfolio of derivatives such as futures contracts, swaps, and options, that are designed to provide investors with triple the daily inverse return of the S&P 500 Index. The ETF uses leverage to achieve this goal, which means that it borrows money to increase the size of its investment in the derivatives.

As of September 2021, the SPXU ETF has a net asset value (NAV) of approximately $1 billion and holds a portfolio of derivatives contracts designed to provide inverse exposure to the S&P 500 Index. The ETF's expense ratio is 0.95%, which is higher compared to other ETFs.

SPXU has a track record of providing investors with amplified returns when the market is declining, but it is important to note that the ETF's returns can also be amplified on the upside. Since its inception in 2009, the fund has provided investors with an annualized return of around -33% (as of March 23, 2023). However, the ETF is designed for short-term trading and is not meant to be held for an extended period of time.

Overall, the Ultrapro Short S&P500 -3X ETF (SPXU) could be a good investment option for investors looking to profit from declining prices in the US equity market. However, due to its high expense ratio and amplified risk profile, it may not be suitable for all investors. Additionally, the ETF's returns may deviate significantly from the returns of the underlying index over longer periods of time, due to the effects of compounding and leverage.




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