ProShares UltraShort QQQ

QID

Market cap $318M

Big Tech's horrible breadth participation and falling number of new highs in August may signal a corrective phase for price, going into the seasonally weak early autumn period of trading. Rising recession odds and a fading AI mania make ProShares UltraShort QQQ an attractive hedge for tech-heavy portfolios. QID offers 2x leveraged downside protection without triggering capital gains on tech winners but comes with time-decay expense and high fees when holding for longer periods.

AI stocks stumbled this week, short sellers won big. Inverse ETFs like SQQQ, TECS, BERZ & QID shone as investors hedged against the AI trade.

QID is a daily trading tool, not a buy and hold investment. The costs as a trading tool are fairly small given liquidity and the spread. The question is whether we want to be trading this specific market - if we do, QID is a useful tool.

After reaching a multi-year low in early April amid the tariff-related market selloff, the Technology Select Sector SPDR Fund NYSEARCA: XLK has recovered some ground as of mid-May. However, the tech sector as represented by this benchmark fund is still experiencing a lackluster start to the year; XLK is down more than 6% year-to-date (YTD).

Wednesday's massive tech selloff points to near-term uncertainties surrounding AI investments.

Wall Street wavered this week on high inflation data which lowered chances of an imminent Fed rate cut. Plus, geopolitical tension in Middle East has weighed on stocks.

BETHESDA, Md.--(BUSINESS WIRE)--ProShares announced forward and reverse share splits on eleven of its ETFs.

Jon Wolfenbarger aims to help individual investors generate double-digit profits and beat the market in both bull and bear markets.

The ProShares Ultra Short QQQ ETF has performed poorly over the last five years, losing -93% of its initial investment value. If a recession occurs in 2024, QID could flip the script and become one of the top-performing ETFs due to the overvaluation of Big Tech stocks. QID's large cash holdings and rising interest yields vastly improved relative returns in 2023. This ETF could easily outperform its 2x inverse leverage goal in a market downturn.