Thu 19 Aug, 2021 03:56 am
If i were to hold one share of either of these for ~ 100$ and some day the share were to go bust dropping down to 0$, would i just lose 100$ (whatever i invest in) or would i lose 300$ (added leverage)? As in if you buy these leverage ETFs, are they just more votatile or are you taking on margins if you lose (leverage/borrowed money)?
@Witpresent14,
You would lose $100. The ETF is leveraged making it more volatile, you are not leveraged so the most you can lose is $100. The reason the ETF went to zero instead of say $65 is because it is leveraged so you still see the risk.
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