Talk:Inverse exchange-traded fund

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this would probably had been a good investment for sep. 29, with the 777 points drop in .DJI, right? —Preceding unsigned comment added by 190.139.223.19 (talk) 18:29, 3 October 2008 (UTC)

Compounding error

I deleted: "Because the ETF is not physical possession of a security, but rather a derivative, it is a synthetic position, and the amount of gain or loss depends on "how much" one notionally possesses, which is called the "notional". For most derivatives, the notional is constant over the life of a contract, but for inverse ETFs, the notional is reset daily."

The claim is undocumented and inaccurate. For example leveraged ETFs are often constructed as corporations, and if it is a long fund it may very well own the underlying shares of the index. More importantly, the ETF is not a synthetic position. A synthetic position refers to the trading of a physical stock to replicate a derivative (option). An ETF on the other hand usually trades future contracts on behalf of its owners. Since these contracts are settled every day, the value of the ETF at the end of the day equals its physical cash holdings (the value of the contracts is zero).

The claim that "for most derivatives the notional is constant" also needs documentation. At least it is not the case for options which probably constitute a large fraction of traded derivatives. Espen Sirnes (talk) 11:02, 20 September 2009 (UTC)

Shouldn't this be part of a larger article on leveraged ETFs?

All of the major points discussed in this article apply equally well to leveraged long ETFs. Point-by-point analysis:

• "Strategies for buy-and-hold investors" -- This should be a subtopic, reclassified as "Strategies for investors"
• "Systemic Impact" applies equally well to the long and the short ETFs.
• "Fees" applies equally well to long and short ETFs
• "Short-term vs. Long-term" -- Long ETFs also decay over time. They are not instruments for the long-term.
• "Volatility loss" -- explicitly notes that the subsequent analysis applies to general leveraged ETFs.
• "List of funds" -- Most of the funds in the list have symmetric leveraged long ETFs. For example: FAZ/FAS BGZ/BGU. This could theoretically be a table, with a "long" and "short" column.
—Preceding unsigned comment added by 66.227.30.35 (talk) 16:45, 8 January 2010 (UTC)

Hypothetical Example

This section is basically just wrong. I suggest removing it.

It appears this information may be based on this article http://www.fpanet.org/journal/CurrentIssue/TableofContents/InverseandLeveragedETFs/ — Preceding unsigned comment added by 75.149.61.58 (talk) 06:57, 2 November 2011 (UTC)

Assessment comment

The comment(s) below were originally left at Talk:Inverse exchange-traded fund/Comments, and are posted here for posterity. Following several discussions in past years, these subpages are now deprecated. The comments may be irrelevant or outdated; if so, please feel free to remove this section.

==B class assessment== This article seems to give an informative overview of a brand new family of products. In the short term, it could benefit from: An idea of where these products are available (which countries and exchanges) A wider range of sources (only 2 references at the moment.) Cover the incoming redirects in the article, with bold mentions in the lead Hope that helps. --Hroðulf (or Hrothulf) (Talk) 10:33, 25 May 2008 (UTC)

Last edited at 10:36, 25 May 2008 (UTC). Substituted at 19:03, 29 April 2016 (UTC)