Home Forums Logical Invest Forum UGLD vs 3X GLD

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    Nelson Brady

    Does the math work out that you can use 3X the number of UGLD shares in GLD for the same result? Or if kept holding them too long because the strategy says that would UGLD gains surpass 3X GLD gains?


    It is only approximately the same as the 3x leveraged rebalance every day so that you will have exactly the 3x daily performance. In a sideways market you will lose slightly because of rebalancing losses, however if the market will go up over a longer period, you will generate more profit due to daily compounding. Also if the market goes down a lot, you will lose less as your loss is limited to the value of the ETF which is 3x smaller than a similar position of unleveraged ETFs.
    I think that such 3x leveraged strategies are much safer than unleveraged strategies if you do not leverage your portfolio. This would mean that you only invest 1/3rd in a 3x leveraged strategy and have 2/3rd in the money market where you get normal interest.

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