We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Wall Street Loses Maximum Since October: Inverse ETFs to Play
Read MoreHide Full Article
Wall Street was hit hard on Dec 2 by fresh trade tensions and downbeat U.S. manufacturing data. Each of the key U.S. indexes — The S&P 500, the Dow Jones and the Nasdaq — suffered their steepest single-day drop since mid-October. Overvaluation concerns probably played a role in dragging down the indexes.
SPDR S&P 500 ETF (SPY - Free Report) , SPDR Dow Jones Industrial Average ETF (DIA - Free Report) and Invesco QQQ Trust (QQQ - Free Report) lost about 0.8%, 0.9% and 1.02%, respectively, on the day.
“President Donald Trump’s announcement that he would reimpose tariffs on Brazilian and Argentinian steel and aluminum” and possibilities of China intensifying retaliation over a supportive U.S. bill toward pro-democracy Hong Kong protestors flared up geopolitical tensions.
Also, U.S. construction spending declined 0.8% in October against expectation of a 0.4% increase. Spending on private, residential and public construction projects declined for the month, leading to more than a 1.8% slump inReal Estate Select Sector SPDR Fund (XLRE) on Dec 2.
How to Profit
Given the upheaval, investors might want to go short on Wall Street as well as global equities, at least for the time being. Below we highlight a few of inverse ETFs.
Dow Jones
Investors intending to play against the tumbling Dow Jones, may tap ProShares Short Dow 30 (DOG - Free Report) (up 1% on Dec 2), ProShares UltraShort Dow30 (DXD - Free Report) (up 2%) and ProShares UltraPro Short Dow30 (SDOW - Free Report) (up 2.9%).
China
China-related inverse play could be Direxion Daily CSI 300 China A Share Bear 1X Shares CHAD( up 0.5% on Dec 2).
S&P 500
Investors can go against the S&P 500 with ProShares Short S&P500 ETF (SH - Free Report) (up 0.9%) and Direxion Daily S&P 500 Bear 1X Shares (SPDN - Free Report) (up 0.8%).
Technology
Technology stocks were hit hard on Monday. Thus, inverse ETF ProShares UltraShort Technology (REW) jumped about 2.8% on Dec 2.
Nasdaq
ProShares Short QQQ (PSQ - Free Report) (up 1.1%), ProShares UltraShort QQQ (QID - Free Report) ) (up 2.2%) and ProShares UltraPro Short QQQ (SQQQ - Free Report) (up 3.3%) are good to play against the Nasdaq.
Small-Cap
One can short small-cap U.S. equities with ProShares Short Russell2000 (RWM) (up 1%).
EAFE
ProShares Short MSCI EAFE (EFZ - Free Report) (up 0.6%) could be a good way to short stocks from the EAFE region and avoid the spillover effect of the global trade fear.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Wall Street Loses Maximum Since October: Inverse ETFs to Play
Wall Street was hit hard on Dec 2 by fresh trade tensions and downbeat U.S. manufacturing data. Each of the key U.S. indexes — The S&P 500, the Dow Jones and the Nasdaq — suffered their steepest single-day drop since mid-October. Overvaluation concerns probably played a role in dragging down the indexes.
SPDR S&P 500 ETF (SPY - Free Report) , SPDR Dow Jones Industrial Average ETF (DIA - Free Report) and Invesco QQQ Trust (QQQ - Free Report) lost about 0.8%, 0.9% and 1.02%, respectively, on the day.
“President Donald Trump’s announcement that he would reimpose tariffs on Brazilian and Argentinian steel and aluminum” and possibilities of China intensifying retaliation over a supportive U.S. bill toward pro-democracy Hong Kong protestors flared up geopolitical tensions.
On top of it, the ISM manufacturing purchasing managers’ index came in at 48.1 for November, down from 48.3 in October and falling short of consensus economists’ expectation of 49.2, according to Bloomberg data. This marked the fourth successive month of ISM data below 50, reflecting a contraction in activity.
Also, U.S. construction spending declined 0.8% in October against expectation of a 0.4% increase. Spending on private, residential and public construction projects declined for the month, leading to more than a 1.8% slump inReal Estate Select Sector SPDR Fund (XLRE) on Dec 2.
How to Profit
Given the upheaval, investors might want to go short on Wall Street as well as global equities, at least for the time being. Below we highlight a few of inverse ETFs.
Dow Jones
Investors intending to play against the tumbling Dow Jones, may tap ProShares Short Dow 30 (DOG - Free Report) (up 1% on Dec 2), ProShares UltraShort Dow30 (DXD - Free Report) (up 2%) and ProShares UltraPro Short Dow30 (SDOW - Free Report) (up 2.9%).
China
China-related inverse play could be Direxion Daily CSI 300 China A Share Bear 1X Shares CHAD( up 0.5% on Dec 2).
S&P 500
Investors can go against the S&P 500 with ProShares Short S&P500 ETF (SH - Free Report) (up 0.9%) and Direxion Daily S&P 500 Bear 1X Shares (SPDN - Free Report) (up 0.8%).
Technology
Technology stocks were hit hard on Monday. Thus, inverse ETF ProShares UltraShort Technology (REW) jumped about 2.8% on Dec 2.
Nasdaq
ProShares Short QQQ (PSQ - Free Report) (up 1.1%), ProShares UltraShort QQQ (QID - Free Report) ) (up 2.2%) and ProShares UltraPro Short QQQ (SQQQ - Free Report) (up 3.3%) are good to play against the Nasdaq.
Small-Cap
One can short small-cap U.S. equities with ProShares Short Russell2000 (RWM) (up 1%).
EAFE
ProShares Short MSCI EAFE (EFZ - Free Report) (up 0.6%) could be a good way to short stocks from the EAFE region and avoid the spillover effect of the global trade fear.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>