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Old 01-19-2016, 09:46 AM   #345
ranchlandsselling
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Join Date: Jan 2011
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Quote:
Originally Posted by darklord700 View Post
HOU is 200% leveraged. So day 1 oil is $30 and loses 10%, HOU will lose 20% or $6.

Day 2 oil start at $27, if you gain 10%, HOU gains $2.7X2=$5.4. So day 1 and 2 combined you still lose $0.60. Is that right?
While a good thought, that's the same with any equity.

If day one apple goes down from $100 to $90 (loss of $10 or 10%)
Day two apple goes up 10% you're back to $99 and you've lost $1.00 even though you've had one 10% down day and one 10% up day.

There's also fees involved in the management of these leveraged products which eat into returns.
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