
Leveraged ETFs Are a Loser's Game
With choppy investment markets, you might be tempted to seek higher returns in leveraged ETFs, but they are a loser's game. Even sophisticated investors get burned by them.
In fact, "very few investment professionals understand the risks over time, let alone retail investors and people in the media," says Jason R. Escamilla, CEO of ImpactAdvisor. These risky investments don't work the same way as typical funds and magnify losses exponentially.
"In certain markets they will dramatically underperform [relative to] the expectations of the everyday investor or finance professional," says Escamilla.