By grouping a bunch of stocks, ETFs diversify instantly ⚡
But, spreading out investments too much can lower returns in the short term 🤔
Leveraged ETFs (LEFTs) exist to solve this 💡
Instead of copying the profit of an index, Leveraged ETFs seek to multiply it! ✨
How? Leveraged ETFs borrow money to match other faster-pace investments 🏎️
The multiple can vary, but strives to be 2x or 3x the return of the normal index 🤑
So, if the S&P 500 makes $100, a Leveraged ETF would hope to make $200! 🏦
But, Leveraged ETFs don’t always get it right 🤕
So, they can be risky and are often used for day trading ❌
Since the money is borrowed, these ETFs are extra dangerous 😱
Leveraged ETFs are not supposed to be held past 1 trading day 🗓️
We’re introducing you to Leveraged ETFs, so you are better prepared in the future, if you ever decide to add them to your portfolio 🧠
Carefully consider your risk tolerance before trading a Leveraged ETF 🦺
And never invest more than you can afford to lose! 🛟