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Direxion Daily 7-10 Yr Trs Bear 3X ETF Message Board

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  • secrtztn secrtztn Mar 29, 2010 10:27 AM Flag

    If you believe the Treasury rates are

    I'm confused. The price of TYO were around $63/$64 at the end of December. I think that interest rates were approx the same as today. So why does TYO now trade under $62?

    I don't understand TYO.

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    • All leveraged ETF's errode over time. Leveraged ETF's are NOT buy and hold for any length of time. That is why day traders love these ETF's. Everyday TYO "resets" and starts "new" the next trading day. So what ever the ETF is tracking to, it can magnify the direction of the underlying index. Lets say the treasury bond price goes down 1% today (about 3% for TYO) and then the next day the treasury bond price again goes down another 1% (TYO over the past two days went up 6% - don't forget this is an inverse ETF.)

16.05-0.23(-1.41%)Oct 2 4:00 PMEDT