 The
VelocityShares 3x Long Gold ETN (UGLD) is an exchange-traded note
(ETN) issued by Credit Suisse AG that provides leveraged exposure to
the price of gold. An ETN is a type of unsecured debt security that is
backed by the credit of the issuing bank and tracks the performance of
an underlying index or asset.
UGLD seeks to provide investors
with three times the daily return of the S&P GSCI Gold Index, which
tracks the performance of gold futures contracts traded on the COMEX
division of the New York Mercantile Exchange. This means that if the
price of gold increases by 1% on a given day, UGLD is designed to
increase in value by approximately 3%.
It is important to note
that UGLD is subject to daily compounding, which can cause returns to
deviate from the expected three times leverage over periods longer
than a day. Additionally, UGLD is subject to fees and expenses that
can reduce returns for investors.
Investing in UGLD may be
suitable for investors who have a bullish outlook on the price of gold
and are comfortable with the risks associated with leverage and ETNs.
However, as with any investment, investors should carefully evaluate
the potential benefits and risks of investing in UGLD and should
consider their investment objectives, risk tolerance, and investment
time horizon before making an investment decision.
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