4D·

Mega drop

Can't believe it, everyone is still crashing today, even though so many people crashed yesterday. People who have experience with leverage: You just buy more to make up for the purchase, right? At -33% I lose everything, right? I have limit buy at 130 once, 125 twice...

PS. My alarm just went off for msci world. Dropped to 91.8. I am very surprised in any case.

04.04

WisdomTree NASDAQ 100 3x Daily Leveraged

Bought x1 at €134.32

€134.32

17 Comments

GG H.@GGHyperX

Even without leverage, my portfolio feels as if I were working with leverage 🫣😅

So better keep your hands off it for the moment, unless you are a trader

•

TotallyLost@TotallyLost

That's not a mega drop, that's a MAGA drop 😅

•

Sandy the Squirrel@Esperanza

@TotallyLost hahahahhaa Humor must not be missing on these days XD

•

Money Game@MoneyGame

I have a huge position in it in my portfolio. The strategy is simple: buy more on days like these and sell at some point in the future when the markets are euphoric again.

•

Sandy the Squirrel@Esperanza

@MoneyGame Thank you for your experience 😊

••

Sandy the Squirrel@Esperanza

@MoneyGame Your BYD position is wild 😳

••

Money Game@MoneyGame

@Esperanza Yes, I've held them for ages. But BYD also went sideways for many years. Holding on is now being rewarded.

•

Sandy the Squirrel@Esperanza

@MoneyGame niiiiiiice

••

SemiGrowth@SemiGrowth

@MoneyGame But you already know that leverage does not work in such a way that your strategy will be successful. Unlike the Nasdaq, it is not the case that the $QQQ3 will continue to rise in the long term. There is no company value behind the prices, as with the Nasdaq, but merely a representation of the index with leverage, which means that the prices are not meaningful. As the index moves as a percentage, there is also the path dependency risk.

TLDR: The price of the $QQQ3 has no significance as to whether it is "cheap" or "expensive", which is why it is theoretically possible in the long term that the leveraged index will never see an ATH again

••

Money Game@MoneyGame

@SemiGrowth Is backtested, in the past this has always worked very well. It only stops working when the NASDAQ stops rising. The path dependency is so small that it has a negative effect but the whole thing still works. As long as the NASDAQ continues to rise, it works!

••

SemiGrowth@SemiGrowth

@MoneyGame how far into the past did you backtest this and with what exact parameters (i.e. you meant "buy on days like this", what is a "this" day). But you certainly didn't achieve alpha with it

••