ProShares UltraShort Industrials (SIJ)

ProShares UltraShort Industrials (SCTR)

Profile:

ProShares UltraShort Industrials is an inverse exchange-traded fund (ETF) that seeks daily investment results that are -2x the daily performance of the Dow Jones U.S. Industrial Average Index. Essentially, it is designed to provide short-term, leveraged exposure to the opposite of the performance of the Dow Jones Industrial Average. This ETF is best suited for experienced investors with a high tolerance for risk and a sophisticated understanding of short-term leveraged investments.

Objective:

The primary objective of SCTR is to deliver investment returns that are inversely proportional to the performance of the Dow Jones Industrial Average. It aims to achieve this by using swaps and other derivative instruments to track the inverse of the index's daily movement.

Issuer:

SCTR is issued by ProShares, a leading provider of alternative and thematic ETFs. ProShares has a solid reputation and track record in the ETF market, known for its innovative and diverse product offerings.

Market Share:

SCTR holds a significant market share within the niche segment of inverse leveraged industrial sector ETFs.

Total Net Assets: The current total net assets for SCTR is approximately $229.54 million as of November 17, 2023.

Moat:

SCTR's competitive advantage lies in its unique focus on providing leveraged inverse exposure to the Dow Jones Industrial Average. This caters to a specific segment of investors seeking short-term, tactical exposure to potential market declines.

Financial Performance:

SCTR's performance is highly dependent on the underlying index's movement. It has historically delivered negative returns in periods when the Dow Jones Industrial Average experiences positive gains. Conversely, it has generated positive returns during periods of market downturns.

Benchmark Comparison:

SCTR's performance is compared against the Dow Jones Industrial Average. Its objective is to deliver returns that are -2x the daily performance of the index.

Growth Trajectory:

SCTR's growth trajectory is tied to the demand for inverse leveraged exposure to the industrial sector and the overall market outlook. Considering the increasing volatility and uncertainty in the market, the demand for such products is expected to remain relevant.

Liquidity:

SCTR has a healthy average daily trading volume, indicating good liquidity. Additionally, the bid-ask spread is relatively tight, implying lower transaction costs.

Market Dynamics:

Factors affecting SCTR's market environment include economic indicators, interest rate fluctuations, sector performance, and overall market sentiment.

Competitors:

Key competitors of SCTR include:

• ProShares Short Dow Jones Industrial Average (DOG)
• Direxion Daily Industrials Bear 3X Shares (DUST)
• VelocityShares Short Industrials 3x (DIX)

Expense Ratio:

The expense ratio of SCTR is 0.95%. This includes management fees and other operating expenses.

Investment approach and strategy:

SCTR utilizes a shorting strategy through swaps and other derivatives to achieve its -2x daily performance objective.

Key Points:

• Seeks -2x daily performance of the Dow Jones Industrial Average.
• Suitable for experienced, risk-tolerant investors.
• Provides leveraged exposure to potential market declines in the industrial sector.
• High liquidity and relatively tight bid-ask spread.
• Expense ratio of 0.95%.

Risks:

• High volatility due to leverage.
• Inverse performance to the underlying index.
• Short-term trading focus.
• Subject to market risk and tracking error.

Who Should Consider Investing:

SCTR is best suited for experienced, sophisticated investors seeking short-term tactical exposure to potential market declines in the industrial sector. It is not recommended for long-term investment or buy-and-hold strategies.

Fundamental Rating Based on AI:

Based on an AI-powered analysis of financial health, market position, and future prospects, SCTR receives a 7 out of 10 rating. The AI system considers factors like historical performance, volatility, expense ratio, market share, and growth potential to arrive at this score.

Resources and Disclaimers:

This information is compiled from publicly available sources such as ProShares website and ETF.com. It is not intended as financial advice and does not constitute a recommendation to invest in SCTR. Investors are advised to conduct thorough due diligence and consult with financial professionals before making any investment decisions.