CEOs, investors and analysts are warning of a recession for the US economy. Experts are primarily concerned about the Federal Reserve’s aggressive rate hikes to bring inflation down to its 2% target.
Indicators such as a reversal in US Treasury yields, a decline in pending home sales and a decline in global freight rates are also pointing sharply to a bearish outlook.
The ProShares Short QQQ (PSQ) provides inverse exposure to the Nasdaq-100 Index. The Fund seeks daily investment results inversely proportional to the daily performance of the underlying index. The fund seeks to profit from market declines and hence, provides a hedge against downside risk.
In the last one year, the ETF has gained 28.7%. It is up 27.7% year-to-date and 11.3% over the past three months and closed its last trading session at $13.83.
Here are the factors that could affect PSQ’s performance in the near term:
PSQ has net assets of $1.58 billion. The current NAV of the fund is $13.83. Its expense ratio is 0.95%, which is lower than the category average of 1.02%. In the past one year, the fund’s net inflows were $598.12 million. It has had a net inflow of $171.59 million in the past six months. It has a five-year beta of negative 0.98.
As of November 18, PSQ’s top holdings include CASH MGMT BILL with a weightage of 3.49% and Treasury Bills. It also holds short positions in the NASDAQ 100 Index Swap Barclays Capital Citibank NA with a negative 15.24% weighting and in the NASDAQ 100 Index Swap Societe Generale with a negative 14.20% weighting.
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