The Motley Fool Discussion Boards
Investing/Strategies / Retirement Investing
|Subject: SSO for Long-Term ROTH||Date: 3/5/2014 12:28 PM|
|Author: spacebound11||Number: 74400 of 78012|
As the title suggests, I'm curious what the other Fools think about investing in a leverage ETF like SSO. Its a 2x S&P 500 ETF. I'm fairly young at 28 so could take on some risk. Here are my thoughts.
1. If I'm investing in an Index why not get more for my money with a 2 or 3x ETF.
2. I realize analysts possibly predict a market correction. That could be the best place to get into a leverage ETF and ride the wave back up.
3. I realize that with volatility a leveraged ETF can return negative earnings even if the underlying index is in the green. However, studies have shown that with a leverage ETF established in 1900, using the DOW as its underlying index, returned 204,000% by Jan 2013. Is this proof of a leverage ETF long term capability?
4. Are the added fees, maybe 1.5%, worth possibly getting more return for my investment.
In summary, I must admit this was one of those water cooler sessions with what seems like a very intelligent co-worker. However, I'm doing as much research as I can and would like some expert Fool input. Is a leverage ETF a good start with a ROTH at a fairly young age?
Thanks. Happy Investing.
|Copyright 1996-2015 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us|