Not sure that I can agree with you. "This allows funds to sell longs reset shorts and make their margin of profit" sounds good but I don't see how it can work in practice. When a fund is long a share, it gets all capital gain and dividends from that share. When a fund is short a share, it loses exactly the amount that a shareholder would gain on a share price rise, and it has to pay out all dividends. IOW, having one share long and one share short is an exact zero (less costs). There is no "margin of profit". The equation is different for other hedging methods. For example, if you buy a share and sell a call option, you pocket the premium regardless, and only end up making a loss in specific circumstances.
SXY Price at posting:
24.0¢ Sentiment: Buy Disclosure: Held
