What are some common uses for leveraged and inverse funds?
Leveraged and inverse funds are valuable tools that can be used in a variety of ways by knowledgeable investors. Some examples include: a. Using the magnified exposure of a leveraged fund to seek greater profits (of course, losses are also magnified). b. Committing less cash to target a specific level of exposure using a leveraged fund. c. Using an inverse fund to help hedge a portfolio position. d. Fine-tuning exposure (e.g., using an inverse fund to reduce exposure to a sector without selling holdings).
