Compounding isn’t always a bad thing for a mutual fund’s performance. Let’s say a double-leveraged fund increases by 10% three days in a row. It would yield a 33.1 percent return. If the index increased 5% on each of those days, the leveraged three-day return would be more than double the index’s 15.8 percent return. […]

Investors have traded the CBOE Volatility Index (VIX) since it was first created as a measure of investor sentiment regarding future volatility. Buying VIX-linked exchange traded funds (ETFs) and exchange traded notes (ETNs) is the most common strategy to trade the index. The iPath Series B S&P 500 VIX Short-Term Futures ETN (VXX), the iPath

The United States Oil Fund LP (USO) is a NYSE Arca-listed exchange-traded security whose shares can be bought and sold. The daily % changes in the net asset value (NAV) of USO’s shares should match the daily percentage changes in the spot price of light sweet crude oil delivered to Cushing, Oklahoma, as determined by

Exchange-traded funds (ETFs) that use a combination of derivatives and debt instruments to double or treble the movement of the underlying asset or index they monitor are known as leveraged ETFs. Leveraged ETFs have become increasingly popular among day traders due to their ability to create high profits quickly—provided, of course, that the trader is

Investors can purchase SPY ETF shares in the same manner they would stock. The first step in investing in SPY is to open an account with a brokerage firm like Charles Schwab, TD Ameritrade, or E*Trade. The next step is to fund the account with cash once it has been opened. You’re now ready to

Silver exchange-traded funds (ETFs) closely monitor the price of the precious metal and are more liquid than holding the metal itself. Investors seeking a hedge against inflation or a safe haven in times of market instability like silver, as do other precious metals. Grantor trusts are a common form for funds whose assets are a

Oil exchange-traded funds (ETFs) follow the price of oil as a commodity and provide direct access to the market. Investing in funds that possess a portfolio of oil stocks is not the same as this strategy. Investing in the oil sector has the potential to yield substantial gains, but the dangers remain high due to

Natural gas exchange-traded funds (ETFs) allow investors to gain exposure to natural gas prices without the complexities of trading natural gas futures contracts or the storage expenses associated with holding real commodities. Natural gas is a commodity that is used for heating, cooking, fuel, and generating electricity. It’s also employed in the production of polymers

Exchange-traded funds (ETFs) that use a combination of derivatives and debt instruments to double or treble the movement of the underlying asset or index they monitor are known as leveraged ETFs. Leveraged ETFs have become increasingly popular among day traders due to their ability to create high profits quickly—provided, of course, that the trader is

Investing with inverse ETFs is straightforward. You just buy shares in the corresponding ETF if you are pessimistic on a certain market, sector, or industry. Simply put a sell order to exit the investment when you believe the decline is over. To benefit, investors must clearly be correct in their market predictions. These shares will