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0.58%

2,958.8 standard & poor's 500

Sorry, but you are missing the maths. Your calc is too...

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poolhustla81

175 Posts.

24

04/05/20

10:57

Post #: 44416868
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Originally posted by crosek: ↑

Keep in mind that BBUS tracks the futures/S&P500 with a natural decay, so technically it can't get to $16 anymore.

Here is the reasoning, for the current BBUS price of $3.50, the price needs to go up 450% to get to $15.75.
That means, using the best case scenario of 2.75x leverage, the S&P needs to fall 163%... You can quickly see that anything close to $16 is impossible.

Price can go up more then 100%, price can't go down more then 100% (well that's wrong as we've seen with oil futures but you get the idea)

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Sorry, but you are missing the maths. Your calc is too simplistic, and misses compounding. Take for example the rise in BBUS from $2.66 to $6.63 (Feb/March 2020...a 149% gain. The fall in the S&P over this same period was 3380 to 2237...a 34% loss. 149% is 4.41 times 34%, not a simple 2.75 times as you suggest.

Value at posting: 2,958.8
2 Upvote

0 Great analysis

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