PSQ: An Inverse Play Against The Nasdaq That 'Might' Work Now

seekingalpha06-18

Morsa Images If you've tracked me for any period of time, then you know, no matter how bearish I get (at times right, at times wrong), that I'm very against outright shorting. The risk is unlimited ...

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The risk is unlimited ...</p>\n\n<a href=\"https://seekingalpha.com/article/4699638-psq-an-inverse-play-against-the-nasdaq-that-might-work-now\">Source Link</a>\n\n</div>\n","source":"seekingalpha_fund","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>PSQ: An Inverse Play Against The Nasdaq That 'Might' Work Now</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nPSQ: An Inverse Play Against The Nasdaq That 'Might' Work Now\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-06-18 00:00 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4699638-psq-an-inverse-play-against-the-nasdaq-that-might-work-now><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Morsa Images If you've tracked me for any period of time, then you know, no matter how bearish I get (at times right, at times wrong), that I'm very against outright shorting. The risk is unlimited ...</p>\n\n<a href=\"https://seekingalpha.com/article/4699638-psq-an-inverse-play-against-the-nasdaq-that-might-work-now\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"TQQQ","symbol_name":"纳指三倍做多ETF","start_time":0,"source_url":"https://seekingalpha.com/article/4699638-psq-an-inverse-play-against-the-nasdaq-that-might-work-now","article_id":"2444191153","we_media_id":null,"thumbnails":["https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1307905824/image_1307905824.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2444191153","pubTimestamp":1718640023,"sourceInfo":{"source_id":"seekingalpha_fund","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"Morsa Images If you've tracked me for any period of time, then you know, no matter how bearish I get , that I'm very against outright shorting. The risk is unlimited when you short, and while some are successful short sellers, it's extremely difficult over long periods of time because the market does have an upward bias. Having said that, there are people who want to bet against the market, and in particular the Nasdaq 100 as represented by Invesco QQQ Trust ETF  given the near vertical move that's taken place since last year. If you're one of those people, the ProShares Short QQQ ETF  is worth considering. What is the PSQ?","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"TQQQ":"纳指三倍做多ETF","BK4112":"金融交易所和数据","NDAQ":"纳斯达克OMX交易所","PSQ":"纳指反向ETF",".IXIC":"NASDAQ Composite","QLD":"纳指两倍做多ETF","QQQ":"纳指100ETF","SQQQ":"纳指三倍做空ETF","BK4593":"纳斯达克ETF","NDX":"纳斯达克100指数","BK4585":"ETF&股票定投概念","BK4534":"瑞士信贷持仓","LU2095319765.USD":"Natixis Thematics Subscription Economy R/A USD","QID":"纳指两倍做空ETF","LU2210150020.SGD":"Natixis Thematics Subscription Economy R/A SGD","LU2210149790.SGD":"Natixis Thematics Subscription Economy R/A SGD-H","BK4588":"碎股","BK4550":"红杉资本持仓","FDN":"First Trust Dow Jones Internet I","BK4561":"索罗斯持仓","BK4581":"高盛持仓"},"translate_title":"PSQ：针对纳斯达克的反向策略现在“可能”奏效","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{".IXIC":1,"NDAQ":1,"NQmain":1,"NDX":0.9,"FDN":0.9,"TQQQ":0.6,"SQQQ":0.6,"QQQ":0.6,"QLD":0.6,"QID":0.6,"PSQ":0.6,"MNQmain":0.6},"content_text":"Morsa Images If you've tracked me for any period of time, then you know, no matter how bearish I get (at times right, at times wrong), that I'm very against outright shorting. The risk is unlimited when you short, and while some are successful short sellers, it's extremely difficult over long periods of time because the market does have an upward bias. Having said that, there are people who want to bet against the market, and in particular the Nasdaq 100 as represented by Invesco QQQ Trust ETF (QQQ) given the near vertical move that's taken place since last year. If you're one of those people, the ProShares Short QQQ ETF (NYSEARCA:PSQ) is worth considering. What is the PSQ? It's an inverse ETF. The fund seeks daily investment results before fees and expenses that correspond to the inverse (-1x) of the daily performance of the NASDAQ 100-Index (NDX). In practice, this means that the ETF will fall equivalent to that of the Nasdaq 100 every day that the index rises, and, similarly, rise when the Nasdaq 100 falls. The key is that it does this using daily returns. A Look At The Holdings To be clear, this is NOT a buy and hold investment. This is a very short-term tactical trading tool which, when it works, can generate big returns. The way that it achieves the inverse behavior is through various swaps with large banks. proshares.com So the inverse behavior doesn't come from actually shorting the QQQ, but rather through the contractual obligations with these banks offering the swaps, settled daily. Sector Composition: Think QQQ Since this is tracking the inverse of the Nasdaq 100, the equivalent inverse exposure is what you see in that average. That means PSQ is taking on roughly half of the inverse Tech exposure in the Qs. This arguably is why some would want to trade the fund, given how outsized the performance of Tech has been in this cycle relative to everything else. proshares.com The tech sector's outsized role in the index's returns is precisely what makes PSQ an interesting tactical hedge for investors looking to short the largest sector of the market. Peer Comparison There are other inverse ETFs out there, of course, many with even more leverage on the inverse side. The ProShares UltraPro Short QQQ ETF (SQQQ), for example, seeks to deliver twice the inverse daily performance of the Nasdaq 100 index. I find this to be a particularly dangerous fund to trade unless your timing is spot on. Betting against the market's uptrend is difficult to begin with, and while leveraging that works when it works, it really doesn't when it doesn't, given the daily compounding of the inverse price behavior. You can see that by comparing the performance of PSQ to SQQQ, where SQQQ has performed far worse (more than double). StockCharts.com Pros and Cons On the plus side, the ETF is a relatively easy and liquid way of allowing short exposure to the tech-heavy Nasdaq 100-Index. If you're convinced that a market has topped and is going to reverse, you have an easy way to bet on it. You could also use this to hedge against some long positions you already have tactically. And while I'm against shorting because your risk is unlimited, the risk is limited in that the worst you can do here is, well, go down to 0. But PSQ is very risky. Like most of the other inverse ETFs, the product is designed for short-term trading and should not be used for buy-and-hold strategies. The daily rebalancing feature - which, of course, is a pro in down trending markets - will lead to significant value erosion and poor performance under extremely volatile or oscillating markets. And because costs are involved in the swap agreements, counterparty risks, and tracking errors may create points of divergence from the true inverse relationship of the fund to the underlying index. Conclusion  To re-emphasize - I don't like shorting, but can see the appeal of an inverse fund so long as the multiple is 1x like PSQ. I think the Nasdaq is insanely overvalued here and crowded, so maybe the timing for PSQ makes sense here. Just know the risks involved, and that the market will always be against those who are bearish and express that bearishness with a down trending bet.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.24.2","shortVersion":"4.24.2","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2444191153"}