ProShares UltraPro Short S&P 500 (SPXU)
ARCA ARCA Primary 
XBER 
SPXU Is For Trading The S&P 500, Not For Buying And Holding
SPXU is designed for -3x daily inverse S&P 500 exposure, making it suitable only for short-term speculation or hedging, not long-term investment. Holding SPXU over time leads to value erosion, due to daily derivative time decay and compounding losses, especially in volatile markets. The ETF is highly liquid with tight spreads and low costs, performing as intended for its specific purpose of daily leveraged trading.
SPXU Ultra-Short S&P 500: Why Being Bearish Is A Bad Idea
Without the help of a crystal ball, holding the ProShares UltraPro Short S&P500 ETF is probably a bad idea for nearly every investor. I believe in the sustained deterioration in market conditions caused by the uncertainty surrounding the current trade war, but this is not enough to justify owning SPXU. For those being careful or skeptical about the prospects of the S&P 500 ahead of a potential recession, I present a few alternatives to being bearish the US equities markets.
SPXU Is In A Positive Drift, But History Suggests Being Cautious
Leveraged ETFs like ProShares UltraPro Short S&P500 ETF have a non-linear behavior. A watchlist with 22 leveraged ETFs. The SPXU ETF is a cost-effective hedging tool in bull markets, but may suffer steep decay during volatile periods.
SPXU: A Bet On Election Uncertainty And Expensive Valuations
The ProShares UltraPro Short S&P500 ETF aims to provide triple the inverse daily performance of the S&P 500, ideal for bearish market outlooks. The ETF is highly leveraged and suitable for short-term trading, not long-term holding due to an elevated expense ratio and numerous medium-and-long-term tailwinds for US stocks. Arguments for a long SPXU position include election uncertainty, high concentration and elevated valuation of the S&P 500, as well as passive investor inflows.
SPXU: A Juicy 10.74% Dividend Out Of Reach
SPXU is a 3x leveraged inverse bet on the S&P 500 with a 10.74% TTM dividend yield from US Treasuries. While the dividend is attractive, it is more of a quirk than something we can effectively capture. The fund's leveraged nature comes with high risk warnings and negative compounding that amplifies losses over time.
