ProShares UltraPro Short Russell2000 (SRTY)

Overview

ProShares UltraPro Short Russell2000 (SRTY) is a leveraged ETF designed to deliver three times the inverse (opposite) of the daily performance of the Russell 2000 index. It targets investors seeking to profit from short-term declines in small-cap U.S. stocks. Asset allocation is primarily through derivatives. The investment strategy involves using financial instruments to amplify the inverse performance of the index.

Reputation and Reliability

ProShares is a well-established issuer known for its leveraged and inverse ETFs, offering a range of specialized investment products.

Management Expertise

ProShares has a dedicated team specializing in managing complex ETF structures, including leveraged and inverse funds.

Goal

The primary goal of SRTY is to deliver three times the inverse of the daily performance of the Russell 2000 index.

Investment Approach and Strategy

Strategy: SRTY aims to provide daily investment results (before fees and expenses) that correspond to three times the inverse (-3x) of the daily performance of the Russell 2000 Index.

Composition The ETF primarily holds financial instruments like swap agreements, futures contracts, and other derivatives designed to achieve its leveraged inverse objective.

Market Share: SRTYu2019s market share in its sector is relatively small, as it is a niche product.

Total Net Assets (AUM): 397300000

Key Competitors

• Direxion Daily Small Cap Bear 3X Shares (TZA)
• ProShares Short Russell2000 (RWM)
• MicroSectors U.S. Small Cap 3X Inverse Leveraged ETN (SMDD)

Competitive Landscape

The competitive landscape is characterized by a few key players offering leveraged and inverse exposure to the Russell 2000. SRTY offers 3x leverage, which can provide higher returns but also carries greater risk than competitors with lower leverage. SRTYu2019s advantage is its high leverage factor, while a disadvantage is the increased volatility and potential for loss.

Historical Performance: Historical performance is highly dependent on the Russell 2000's performance. Due to leverage and compounding, long-term performance can deviate significantly from -3x the index's performance.

Benchmark Comparison: The ETF's performance should be compared to -3x the daily performance of the Russell 2000. However, due to the daily reset, compounding effects can cause significant deviations over longer periods.

Expense Ratio: 0.95

Average Trading Volume

SRTY exhibits relatively high average trading volume, indicating good liquidity.

Bid-Ask Spread

The bid-ask spread is typically tight, which can vary based on market conditions.

Market Environment Factors

Economic indicators, interest rate changes, and investor sentiment towards small-cap stocks significantly affect SRTY's performance. Increased volatility in small-cap stocks can lead to large swings in SRTY's value.

Growth Trajectory

Growth trends are tied to the bearish or sideways movements of Russell 2000. Changes in strategy and holdings are infrequent but can occur to maintain its leverage target.

Competitive Edge

SRTY's competitive advantage lies in its 3x leveraged exposure to the inverse of the Russell 2000, offering investors a tool to potentially magnify short-term gains when they anticipate a decline in small-cap stocks. Its daily reset feature allows traders to actively manage their exposure. SRTY is suitable for short-term trading strategies rather than long-term investments. ProShares reputation for providing complex investment tools also contributes to its competitive standing.

Volatility

SRTY exhibits very high volatility due to its leveraged nature. This makes it suitable only for investors with a high-risk tolerance.

Market Risk

SRTY is subject to market risk related to the Russell 2000, including economic downturns, sector-specific risks, and changes in investor sentiment towards small-cap stocks.

Ideal Investor Profile

The ideal investor for SRTY is an experienced trader with a high-risk tolerance, seeking short-term profit from a decline in small-cap stocks. These investors should understand the risks associated with leveraged ETFs and be prepared to actively manage their positions.

Market Risk

SRTY is suitable for active traders with a short-term investment horizon. It is not suitable for long-term investors or passive index followers.

ProShares UltraPro Short Russell2000 (SRTY) is a leveraged ETF designed to provide -3x the daily performance of the Russell 2000 index. It is a niche product suitable for experienced traders seeking short-term profits from declines in small-cap stocks. The ETF carries significant risks due to its leveraged nature, making it unsuitable for long-term investments or risk-averse investors. Its performance depends heavily on the Russell 2000 and is influenced by economic conditions and market sentiment.

Data Sources:

• ProShares Website
• ETF.com
• Morningstar

Disclaimers:

This data is for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Investing in leveraged ETFs involves significant risk of loss.