Latest news with #Nasdaq100
Yahoo
3 hours ago
- Business
- Yahoo
3 Reasons to Buy QLD and 3 Reasons Not To
QLD is an ETF that aims to double the gains of the Nasdaq-100. But it also doubles your losses if the index declines. Its wild swings, dependence on swap contracts, and high expense ratio make it a very risky investment. 10 stocks we like better than ProShares Trust - ProShares Ultra Qqq › ProShares Ultra QQQ (NYSEMKT: QLD) is an exchange-traded fund (ETF) that tracks the Nasdaq-100 index. But unlike other Nasdaq-100 ETFs, which directly track the index, Ultra QQQ aims to double the performance of the Nasdaq-100. If the Nasdaq-100 rises 1% in a day, the Ultra QQQ should advance 2%. But it also doubles its losses: If the Nasdaq-100 declines 1%, the Ultra QQQ should drop 2%. It tries to consistently double those gains and losses with a mix of swap agreements, options, and other derivatives. Over the past five years, the Nasdaq-100 has rallied 114% as Ultra QQQ's price surged 191%. While it hasn't exactly doubled the Nasdaq-100's return -- since it needs to be constantly rebalanced -- it still outperformed the index by a significant margin. Is Ultra QQQ a good growth play for investors who can stomach the volatility? Let's review the three reasons to buy this ETF -- and the three reasons to avoid it -- to decide. Ultra QQQ might be worth buying for three reasons: The tech sector is booming, its derivatives strategy allows its investors to pursue riskier strategies with less capital, and it could be a useful tool for short-term traders who can stomach a lot of volatility. The Nasdaq-100's biggest companies include Microsoft, Nvidia, Amazon, Apple, and Broadcom. These companies have plenty of exposure to the secular expansion of the cloud and artificial intelligence (AI) markets, and their stocks could continue to beat the market. If that happens, it might be smart to park your cash in an ETF that aims to double those returns. If an investor wants to replicate Ultra QQQ's aggressive strategies on their own, they may need to deploy a lot more cash or take on margin loans to fund their own derivative trades. Simply buying the ETF puts those decisions in the hands of its fund managers -- and frees up investors' cash for other investments. For short-term traders, Ultra QQQ could be a great way to amplify gains from temporary tailwinds, such as economic data, earnings reports, and other news-driven events. Ultra QQQ is a tough ETF to recommend for three reasons: Its dependence on swap contracts is risky, it magnifies losses, and it charges high fees. Ultra QQQ tethers most of its assets to swap contracts. This means that it strikes agreements with banks and other parties to receive double the gain of the Nasdaq-100 on a regular basis. In return, it continues to pay fees and interest to those banks. But if a bank struggles or goes bankrupt, that swap contract could collapse and leave Ultra QQQ empty-handed. It mitigates that counterparty swap risk by diversifying its contracts, but it could face major losses in the event of another credit crunch or financial crisis. The way it doubles the Nasdaq-100's losses also makes it a much riskier investment than other ETFs, such as the Invesco QQQ Trust (NASDAQ: QQQ), which simply tracks the Nasdaq-100. While it may be an attractive ETF for short-term traders seeking to magnify their gains, it could easily backfire and burn investors during a market downturn. Lastly, the Ultra QQQ charges a gross expense ratio of 0.97% and a net expense ratio of 0.95%. In comparison, the Invesco QQQ Trust charges a total expense ratio (comparable to the gross expense ratio) of just 0.20%. Therefore, you're paying nearly five times the fees to try to double the Nasdaq-100's gains, but you're exposing yourself to double its downside potential. Warren Buffett famously told investors to be "fearful when others are greedy," and the Ultra QQQ ETF is a pretty greedy play. If you expect the Nasdaq-100 to keep rising and can stomach a lot of near-term volatility, this ETF might be worth nibbling on as a short-term trade. But if you're looking for a diversified, low-cost ETF to hold while sleeping soundly at night, the Ultra QQQ ETF isn't for you. Instead, you should either stick with a straightforward ETF, such as the Invesco QQQ Trust, or a less volatile one that tracks the S&P 500. Before you buy stock in ProShares Trust - ProShares Ultra Qqq, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and ProShares Trust - ProShares Ultra Qqq wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $966,931!* Now, it's worth noting Stock Advisor's total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 23, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Leo Sun has positions in Amazon and Apple. The Motley Fool has positions in and recommends Amazon, Apple, Microsoft, and Nvidia. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. 3 Reasons to Buy QLD and 3 Reasons Not To was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Insider
13 hours ago
- Business
- Business Insider
Stock Market News Review: SPY, QQQ Resilient as U.S.-Canada Trade Talks End, Inflation Rises
Both the S&P 500 ETF (SPY) and the Nasdaq 100 ETF (QQQ) secured new intraday all-time highs on Friday, although some of the gains were erased after President Trump said that the U.S. had terminated its trade talks with Canada. Confident Investing Starts Here: Following Canada's decision to proceed with its digital services tax on U.S. technology companies, Trump announced a halt to all U.S.-Canada trade discussions. The tax charges a 3% fee on all U.S. tech revenue above C$20 million, or about $14.6 million, collected from Canadian users. 'We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period,' said Trump on Truth Social. Trump also said that the U.S. would no longer consider removing sanctions on Iran following a speech from Iranian Supreme Leader Ayatollah Ali Khamenei. Khamenei downplayed the damage of the U.S. strikes on three of Iran's nuclear sites and said that the country had delivered a 'slap to America's face.' Meanwhile, the core personal consumption expenditures (PCE) index, the Fed's preferred gauge of inflation, showed a monthly rise of 0.2% and a yearly rise of 2.7%. Economists were expecting growth of 0.1% and 2.6%, respectively. Furthermore, April's core PCE was revised upward to 2.6% from 2.5%. Core PCE excludes food and energy prices from the regular PCE index given their volatility. Shifting gears to more optimistic news, Trump is preparing executive orders to support AI development, according to Reuters. The orders could include green-lighting the construction of AI data centers on federal land and easier grid access for new energy projects, said sources close to the matter. What's more, consumer sentiment could be in the early stages of a recovery. The June Index of Consumer Sentiment rose by 16% month-over-month to 60.7, reversing six consecutive months of declines. Economists were expecting 60.5, with a higher figure representing a more positive economic outlook. At the same time, fears over tariff-driven inflation and economic uncertainty still persist. 'Despite June's gains, however, sentiment remains about 18% below December 2024, right after the election; consumer views are still broadly consistent with an economic slowdown and an increase in inflation to come,' said Survey of Consumers Director Joanne Hsu.
Yahoo
16 hours ago
- Business
- Yahoo
Nasdaq Hits Record While Bitcoin, Gold Remain Under Pressure After Latest Macro Data
Bitcoin BTC continues to consolidate in the $102,000 to $108,000 range and gold is lower by 2% today and roughly 7% from its record high. Meanwhile, the Nasdaq 100 has reached new all-time highs. A couple of U.S. macroeconomic data points Friday morning — though nearly two months old at this point — might have added to the modestly negative tone for BTC and gold. Personal income in May came in at -0.4%, falling short of the expected increase of 0.3%. Personal spending month over month printed at -0.1%, missing the forecast of a 0.1% increase. Maybe of more import to markets, the core PCE price index in the US, which excludes volatile food and energy prices and is the Federal Reserve's chosen gauge of underlying inflation, rose by 0.2% in May compared to expectations of a 0.1% increase. On a year-over-year basis, core PCE prices rose 2.7% versus 2.6% expected. This data further supports the view that the economy may be heading toward stagflation. Noted goldbug and no-coiner Peter Schiff: "Traders continue to sell gold even as this morning's release of weak economic data and stronger-than-expected inflation data pushed the dollar index to new lows. Stagflation and a tanking dollar are bullish for gold, regardless of any superficial trade deals 'negotiated' by Trump." Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
The Star
17 hours ago
- Business
- The Star
Wall St Week Ahead: Jobs data, trade, fiscal policies in focus
NEW YORK: Investors who have been captivated by recent geopolitical events are poised to shift their attention in the coming week to key economic data and looming policy deadlines to see if the torrid rally in US stocks extends higher. The tech-heavy Nasdaq 100 tallied a record high this week while the benchmark S&P 500 moved to the cusp of an all-time peak. Easing tensions in the Middle East paved the way for the latest bump higher in stocks, as a conflict between Israel and Iran appeared to calm after missile strikes between the two nations had set the world on edge.
Business Insider
a day ago
- Business
- Business Insider
Stock Futures Up as SPX Eyes New High
U.S. stock futures trended higher ahead of Friday's session as investors watched major indexes near record highs and awaited key inflation data. Futures on the Nasdaq 100 (NDX), the Dow Jones Industrial Average (DJIA), and the S&P 500 (SPX) were up 0.11%, 0.15%, and 0.12%, respectively, at 1:09 a.m. EST, June 27. Confident Investing Starts Here: In Thursday's trading, the stock market posted solid gains, with both the S&P 500 and Nasdaq 100 closing near all-time highs. The S&P 500 rose 0.80%, the Nasdaq 100 added 0.94%, and the Dow Jones climbed about 0.9%. On Friday, all eyes will be on the May reading of the personal consumption expenditures (PCE) price index, a key inflation gauge.
