# QID - UltraShort QQQ ProShares



## RichKid (21 March 2008)

QID is an US (AMEX) listed etf for the short side, chart below compares QID to the nasdaq-100. This US etf allows you to go 'long' stock to gain exposure to the short side of the us markets. The leverage should magnify the disparity bw the etf and the underlying, I haven't checked if it's actually twice that of the underlying as claimed. There should be other etf's which look to invert the returns or the major indices. Still doing research to see if there are any hidden costs or risks....(QQQ is the symbol reference to the long etf). Please share your knowledge or experience in this forum if you know more about these short etf's.

Price quote via: http://moneycentral.msn.com/detail/stock_quote?Symbol=QID

From msn MoneyCentral:



> QID  UltraShort QQQ ProShares
> 
> Overview
> The investment seeks daily investment results, before fees and expenses, which correspond to twice the inverse of the daily performance of the NASDAQ-100 index. The fund normally invests 80% of assets in financial instruments with economic characteristics that should be inverse to those of the index. It may employ leveraged investment techniques in seeking its investment objective. The fund is nondiversified.


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## peter2 (21 March 2008)

As US citizens can not short equities in their super funds (IRA accounts), they could not profit from any downward movement in price. They are allowed to buy into EFTs that do profit from falling prices. It is a great way to hedge their portfolios and to diversify into commodities without using futures. 

For additional info. the proshares site is a good place to start looking.

http://www.proshares.com/funds


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## RichKid (23 March 2008)

peter2 said:


> As US citizens can not short equities in their super funds (IRA accounts), they could not profit from any downward movement in price. They are allowed to buy into EFTs that do profit from falling prices. It is a great way to hedge their portfolios and to diversify into commodities without using futures.
> 
> For additional info. the proshares site is a good place to start looking.
> 
> http://www.proshares.com/funds




Thanks very much peter, that's interesting information. I'll check out the other big index trackers too. I have had a look at the proshares site before but I think I missed the short funds.


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## wayneL (23 March 2008)

There are other ultrashort ETFs on the other indicies and sector indicies as well.

I don't trade them, but I read somewhere that one must be careful because of how the ETF is computed. It is only a "direct", leveraged reverse correlation apparently on a daily basis and on a longer term the reverse correlation could break down to a point. 

For instance if QQQQ tanks 10% over a period of weeks, one would expect QID to be up 20%. However this might not be the case, it could be much less. (The exact mechanics if this I don't know) Just a heads up on that.

But a very interesting product all the same under the circumstances you mention RK.


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## RichKid (24 March 2008)

wayneL said:


> There are other ultrashort ETFs on the other indicies and sector indicies as well.
> 
> I don't trade them, but I read somewhere that one must be careful because of how the ETF is computed. It is only a "direct", leveraged reverse correlation apparently on a daily basis and on a longer term the reverse correlation could break down to a point.
> 
> ...




Thanks very much Wayne, the charts usually show up the extent of correlations or leverage so I'll be lazy and go off that as I'm sure to get confused if I follow the mechanics to much, wish I cold follow their computations though. I'll be watchful for signs of the correlation breaking down.

So, just going off the chart scale in my first post, the leverage appears to be less than double (I was going to say '...appears to be short of double' but that would have been a silly pun)....<ahem>....let's consider this- Nasdaq-100 is tracked by QQQQ (will be some distortion here unless the QQQQ perfectly tracks the underlying), that distortion is then inverted via the QID, so there would be further distortion here (bw QQQQ & QID). Unless they hedge perfectly at each of those two possible distortion points we are unlikely to get a twice leveraged exposure to the downside in the Nasdaq-100. 

NB As I understand it 'QQQ' is part of the name of the product and 'QQQQ' ('the cubes') is the ticker symbol. Some info on etf's here: http://www.thestreet.com/life-and-money/etfs/index.html

Hope this makes sense. Lots more research to be done on this topic.

Caution: I only have a smattering of inter-market charting experience (eg see the old sugar/csr study here on ASF that I dabbled with some time ago).


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## finicky (21 April 2022)

'BtL finance' mentioned in his recent podcast that he has a position in this (code: *QID*) along with his gold stocks. One to consider I guess, like BBUS, but unlike BBUS it doesn't look buyable on the ASX. 
Decade monthly chart of the etf, QID, that is a *double short on the nasdaq* (or more correctly, the etf that tracks the nasdaq QQQ). Check out the unprecented positive monthly volume.

QID


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