ZIV / UGLD delist

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  • #79090
    Nicolasblidi
    Participant

    https://www.forexlive.com/news/!/credit-suisse-to-delist-its-highly-leveraged-etfs-20200622

    I would get out of those as lots of selling would be expected…

    #79095
    DWoods
    Participant

    I sold both today. I bought UGL with my UGLD holdings and put my ZIV balance into TQQQ (SPXL).

    I think this is a sign that the market will continue to delist more leveraged ETNs and ETFs this year. They dont want the average retail investor outperforming the big money robbing financial firms anymore.

    The March crash made instant millionaires out of some lucky TVIX holders too. The big guys hate that.

    #79096
    ikoskela
    Participant

    Thanks for sharing this.

    #79097
    Alexander Horn
    Keymaster

    We’re currently looking at the different options and going to post a note over the weekend – in advance of the next rebalancing.

    #79098
    StefanM
    Participant

    Thanks Alexander.
    Would you suggest selling out of UGLD positions urgently and leaving proceeds in cash (or another leveraged GLD product)?

    #79099
    ikoskela
    Participant

    I sold this morning and I’m leaving it in cash just because we don’t much time left in the month. Just remember to limit order, not market, if it goes OTC.

    #79100

    There is not really a replacement for the 3x leveraged UGLD. We may switch to a 2x leveraged version of the leveraged UIS strategy using SSO, UGL and UBT. This works well and the ETFs are very liquid.
    The MYRS strategy could be continued using VXZ short positions instead of ZIV and UGL UBT as hedge. This works even a little bit better than with ZIV as VXZ has not these rebalancing losses of inverse ETFs, but shorting ETFs is probably not possible with many trading accounts.
    You can keep your positions until end of the month. We will inform before the rebalancing on how we will continue.
    Regards Frank

    #79104
    Mark Vincent
    Participant

    Hello Frank,

    What is the difference between UGL and UGLD. They are both 3 times leverage but the returns are different? More Blunt why is UGL not a good choice to replace UGLD.

    Regards,
    MV

    Note: Does anyone know why they are closing them?

    #79107

    UGL is only 2x leveraged Gold. UGLD is the only 3x leveraged gold ETF

    #79108
    marcel
    Participant

    Hi Frank, hi Alex,

    it would be great if going forward there would be the option to still replicate the current versions of the Universal Investment Strategy and Max Yield Strategy using futures, e.g. by creating a synthetic UGLD version (that is the daily 3x of GLD) instead of having to follow a workaround using UGL or the like.

    Thank you!
    Marcel

    #79109

    Anyway there is no problem to just buy 1.5x the UGLD dollar amount of UGL to have the same effect. Also you can just buy 3x the amount of forex gold XAUUSD to replace UGLD

    #79120
    Mark Vincent
    Participant

    Thanks Frank I missed that. UGL in most strategies outperforms UGLD. And UGL has outperformed SPXL over the last couple of years. What is the danger in just using UGL? A better question is what is danger in mixing different leverage ratios if the results are better in the backtests and the optimizier looks good?

    #79122
    Patrick
    Keymaster

    Note that UGL does send Schedule K-1 forms for taxable accounts, which can add a little time and complexity when filing taxes. That should not apply to IRA and 401k accounts.

    #79126
    mk
    Participant

    As EU citizien I cannot trade the non-UCITS-ETFs a longer time :-(
    Therefore I switched to https://www.wisdomtree.eu/de-de/etps/commodities/wisdomtree-gold-3x-daily-leveraged
    But the liquidity/trading volume is not comparable to the originals.

    #79127

    Don‘t forget that the most liquid with small spreads and low fees is forex gold XAUUSD. Also it is traded nearly 24h/day. Normally it is no problem to buy 3x the UGLD $ amount because of low margin requirements.

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