How to Use SQQQ ETFs in Trading (2024)

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Be Aware: You can lose all, but not more than the balance of your Trading Account. These products may not be suitable for all clients therefore ensure you understand the risks and seek independent advice. This material does not constitute an offer of, or solicitation for, a transaction in any financial instrument. Fortrade accepts no responsibility for any use that may be made of the information and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information, consequently any person acting on it does so entirely at their own risk. The information on this site is not directed at residents of the United States or Belgium and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Be Aware: You can lose all, but not more than the balance of your Trading Account. These products may not be suitable for all clients therefore ensure you understand the risks and seek independent advice. You do not own, or have any interest in, the underlying assets. Fortrade Canada Limited is an Order Execution Only broker, and does not provide investment advice or recommendation. Fortrade is a member of the Canadian Investment Regulatory Organization (CIRO) and a member of the Canadian Investor Protection Fund (CIPF). Fortrade Canada Limited is authorised to provide CFD trading services in all provinces in Canada except Quebec. Residents of Alberta province are required to be Accredited Investors to trade CFDs.

CFDs are complex and highly speculative instruments, which come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing all your invested capital. Be Aware: You can lose all, but not more than the balance of your Trading Account.
76% of retail investor accounts lose money when trading CFDs with this provider. These products may not be suitable for all clients, therefore ensure, that you understand the risks and seek independent advice.

Should you proceed with investment in CFDs on virtual currencies, please note, that the values are highly volatile and may result in a significant loss for a short period of time.

This material does not constitute an offer of, or solicitation for, a transaction in any financial instrument. Fortrade accepts no responsibility for any use that may be made of the information and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information, consequently any person acting on it does so entirely at their own risk.

The information on this site is not directed at residents of the United States or Belgium and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Be aware, as a retail client you can lose all, but not more than the balance of your trading account due to Fortrade’s negative balance protection. The information on this site is not directed at residents of the United States or Belgium and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

How to Use SQQQ ETFs in Trading (2024)

FAQs

How to trade the SQQQ? ›

The good news is that trading SQQQ ETFs is fairly straightforward, no matter whether you're a beginner or an experienced trader. The process is more or less the same as with any ETF—you open an account at a brokerage, proceed with a deposit, and open a position.

How do you use inverse leveraged ETFs? ›

Investing in inverse ETFs is quite simple. If you are bearish on a particular market, sector or industry, you simply buy shares in the corresponding ETF. To exit the position when you think the downturn has run its course, simply place an order to sell.

How long should you hold SQQQ? ›

The SQQQ is meant to be held intraday and is not a long-term investment, where expenses and decay will quickly eat into returns.

Can you make money on SQQQ? ›

Pros of SQQQ

It provides investors the potential to profit in a declining market. Leveraged returns: The triple leverage mechanism amplifies the inverse daily return of the Nasdaq 100. This presents the opportunity for significant gains during market downturns.

How does the SQQQ work? ›

SQQQ is an aggressive take on the large-cap space by providing geared inverse (-3x) exposure to the NASDAQ-100 index an index of 100 tech-heavy firms listed on NASDAQ that excludes financials. To provide this exposure, the fund uses swaps on the popular NASDAQ-100 ETF (QQQ), swaps on the index itself, and futures.

Can you hold SQQQ for more than a day? ›

While the Fund has a daily investment objective, you may hold Fund shares for longer than one day if you believe it is consistent with your goals and risk tolerance. For any holding period other than a day, your return may be higher or lower than the Daily Target.

How long should you hold inverse ETFs? ›

Holding an inverse ETF for more than a day can produce returns that don't track with the total return of the underlying security. The more volatile the underlying security, the greater the tracking error.

How do 3x inverse ETFs work? ›

Using the previous example, when the Nasdaq-100 returns a gain of 1%, an inverse ETF will produce a loss of 1%. If an investor buys a Nasdaq-100 3X leveraged inverse ETF, and during one trading day, the S&P 500 drops by 1%, the investor holding this ETF would achieve a positive 3% return.

Why should you not hold leveraged ETFs overnight? ›

The reason for this is that the leveraged ETF is designed to provide multiple returns of the underlying asset on a daily basis. The compounding effect of daily returns means that losses in the ETF are magnified over time.

What happens if I hold SQQQ overnight? ›

While the Fund has a daily investment objective, you may hold Fund shares for longer than one day if you believe it is consistent with your goals and risk tolerance. For any holding period other than a day, your return may be higher or lower than the Daily Target.

Is it good to hold SQQQ long term? ›

The key word here is "daily." Due to how compounding works, holding SQQQ for longer periods of time may result in unpredictable returns. So, holding SQQQ long term is not recommended as the ETF suffers from significant volatility decay, causing its share price to lose value if held for too long.

Does SQQQ reset every day? ›

ProShares UltraPro Short QQQ (SQQQ)

If the Nasdaq-100 falls 1% over a day, then the fund is expected to return 3%. Since SQQQ's leverage resets on a daily basis, holding the fund beyond a single day may compound returns and provide results that are different from the target return.

What makes SQQQ go up? ›

SQQQ is a highly leveraged, volatile fund. It's an inverse index fund meaning the price should go up when the market declines.

Is SQQQ worth buying? ›

SQQQ holds several positive signals and is considered to be a good choice at current levels. We expect the SQQQ ETF to perform great in the short-term period. We have upgraded our analysis conclusion for this ETF since the last evaluation from a Sell to a Strong Buy candidate.

How often does SQQQ pay dividends? ›

SQQQ Dividend Information

The dividend is paid every six months and the last ex-dividend date was Mar 20, 2024.

Is it a good idea to buy SQQQ? ›

SQQQ Signals & Forecast

The SQQQ ETF holds a sell signal from the short-term Moving Average; at the same time, however, there is a buy signal from the long-term average. Since the short-term average is above the long-term average there is a general buy signal in the ETF giving a positive forecast for the stock.

What are the fees for SQQQ? ›

Operational Fees
SQQQ Fees (% of AUM)Category Return Low
Expense Ratio0.99%0.59%
Management Fee0.75%0.35%
12b-1 FeeN/A0.00%
Administrative FeeN/A0.03%

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