DUG is a mean ETF, we all knew this. It has performed poorly, and right now is performing poorly. This is because the sector it tracks the inverse of has done very well -- too well in fact that we all feel like a correction is near. But ladies and gentlemen, the correction has not come yet. What holds us together is that we have faith it will.
Don't lose sight of that and drive yourself crazy. Focus.
I admire investors are who resilient and hold true to their conviction when first entering a stock etc. However, the main issue with DUG is that the chart has been one direction all year. I am assuming you must think the catalyst for this downward movement is the rise in Oil prices? If so, then you have a barrage of people on this board who will contest that assumption.
Fact is the components that make up DUG are in constant conflict with each other. Occasionally the movement in some of these components overwhelms the rest but more times than not they cancel each other out.
I find it very interesting that XOM has traded consistently in a range all year. Very predictable, and yet DUG has continued in one direction - down. Its rises are weak and its fall or worsening all the time.
Personally, I think any ETF as confused as this is an easy target for manipulation. Half the people including myself can't tell what side is up or down with this thing - nobody knows and therein lies the opportunity for the 'manipulators'. Not saying this is a certainty but definitely a possibility.
XOM is weighted 25% of the DUG etf and is only up .65% rt now.
in fact, the top 3 weighted DUG components which includes CVX (up 1.13%)& COP (up 1.4%) along with XOM are holding the djusen down. the rest of the top 18 components which make up 80% of the weighting are all up much larger %-wise (all above 2% and most up 3-4%).
I believe what is happening is that the overall mkt is becoming more bearish and money is exiting the financials & techs and moving into the area that's been by far the safest and most profitable investment this yr - the energy stocks.
It doesn't really matter what spot price of oil does rt now, investors (and speculators) and moving more and more into the energy stocks which make up the djusen thus DUG is heading the wrong way.
This will get worse if Dow breaks down thru 12k which I hope doesn't happen. I think we're close to a climax (short term) with oil. But irrespective we'll see DUG move back up next week not matter what oil does - energy stocks are just getting too far ahead of themselves and need to back off.