An investment is when an individual invests a substantial amount at one go in a particular scheme. Market returns are based on the composite closing price and do not represent the returns you would receive if you traded shares at other times. Comparison: TQQQ S&P 500 The chart above represents the growth of a hypothetical investment of $10,000. Overview. For standardized returns and performance data current to the most recent month end, see above. Due to thecompoundingof daily returns, holding periods of greater than one day can result in returns that are significantly different than the target return, and ProShares' returns over periods other than one day will likely differ in amount and possibly direction from the target return for the same period. TECL has a higher 5-year return than TQQQ (32.66% vs 25.8%). Although still not fully following the true historical TQQQ close prices, the non-linear regression method clearly gave a better approximation than the other two methods. $51.30 - $45.00 = $6.30. how to calculate project profitability with rate of return If QQQ goes down 10% more to $260 area, then TQQQ falls more than 30% to $18 If QQQ goes down 10% more to $260 area, then TQQQ falls more than 30% to $18. Investors assume its risks are those. Ok, bonds rant over. This is the biggest loss in percentage in all investing period. DIVIDENDS. Let me know in the comments. This calculator can use data dating back to the first trading month of 2010 February, so it will definitely show you the power (and sometimes maybe weakness) of the DCA strategy. For these reasons, Im a fan of using UPRO instead (the Hedgefundie strategy). I used quarterly rebalancing in the backtest above. ProShares based on Nasdaq indexes are not sponsored, endorsed, sold or promoted by Nasdaq OMX or its affiliates, and they make no representation regarding the advisability of investing in ProShares. However, because of the structure of leveraged ETFs, the recommended holding period is from intraday to only a few days. My overall portfolio is about 66% TQQQ. TQQQ has grown in popularity after a decade-long raging bull market for large cap growth stocks and specifically Big Tech. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. Hello John, great article, thank you for writing it! This would net 1250 a week x 4 weeks = 5k a month. Its objective is to deliver a return that is 3 times the daily return of its target index - the Nasdaq 100. All leveraged ETPs are ineligible for use of day trading buying power. We notice obvious deviations appear when we look back to the beginning of the pandemic in early 2020. This is the biggest growth of profit in percentages in a single month. VXUS vs. IXUS Vanguard or iShares International ETF? The minimization is done with respect to the leverage and the daily expense ratio. Your allocation is now 55/45, so you would need to rebalance selling TQQQ and buying TMF to get back to your target 50/50 allocation. Both are slightly higher than target values. Many tend to miss the fact that covered calls cap the upside. HOEY INVESTMENTS, INC Buys 1, Sells 4 in 2nd Quarter, WEALTH ADVISORS, INC. Buys 3, Sells 2 in 2nd Quarter, Top 5 2nd Quarter Trades of DOPKINS WEALTH MANAGEMENT, LLC, Paragon Advisors, LLC Buys 4, Sells 1 in 2nd Quarter. Backtest dollar-cost averaged investments one-month intervals for any stock, exchange-traded fund (ETF) and mutual fund listed on a major U.S. stock exchange and supported by Alpha Vantage.Some stocks traded on non-U.S. exchanges are also supported. Hi, great article. Tqqq Return Calculator. Certain ETFs will not be immediately marginable at TD Ameritrade through the first 30 days from settlement. ProShares continues to innovate with products that provide strategic and tactical opportunities for investors to manage risk and enhance returns. To comply with NFA regulations, we display Cumulative Rate of Return for strategies with a track record of less than one year. Here you can view on what time what actions has been taken: Caution! Prudent investors back-test their strategies when trading leveraged ETFs. TMF is a very popular leveraged ETF for long-term treasury bonds. But I am not able to simulate it for TQQQ cause the system keeps saying The time period was constrained by the available data for TQQQ. 1 more reply. This means if the Nasdaq goes up by 1% today, TQQQ should go up by 3%. Make a column in spreadsheet next to it for 3x those numbers minus fees and trading costs.3. 01/2023. In other words, you might get different results for the 2022 tax year than you did for 2021. . No. We are constantly developing StocksPriceHistory.com, so we will add this feature in the near future! We hope you enjoyed the CEF and ETF total return calculator. The DRIP calculator estimates the return of $10,000 over the 10 year time frame. In short, volatility decay is not as big of a deal as its made out to be, and we would expect the enhanced returns to overcome any volatility drag and fees. However, it is a leveraged product using derivatives and debt to increase the returns to investors. Also, what is your take on TLT vs TMF: https://seekingalpha.com/article/4037686-why-tmf-will-tend-to-underperform-tlt-long-termWould it make more sense to use margin for TLT instead of buying TMF directly? But we can improve the accuracy of the model. Leveraged ETFs often come with higher expense ratios because of higher management fees. Thanks. Jensen's alpha This website may use cookies or similar technologies to personalize ads (interest-based advertising), to provide social media features and to analyze our traffic. I wanted to go all in with TQQQ Thanks for this instructive info,Could you just clarify Youll need to rebalance a strategy like this regularly please? Thanks, Simone! The graph above illustrates in theory why a 100% TQQQ position is not a good investment for a long term hold strategy. TYD 3x intermediate treasuries less interest rate risk. All quotes are in local exchange time. Refund Transfer is a bank deposit product, not a loan. Here's a look at QQQ with SQQQ overlaid on the 5-minute chart: You'll notice that SQQQ (the blue line) amplifies the inverse of QQQ's daily returns. VOO vs. VTI Vanguard S&P 500 or Total Stock Market ETF? This may be used in conjunction with other index ETFs to create a well-diversified portfolio for the long run. There are tons of articles debating over the pros and cons of leveraged ETFs, but we leave that in a separate article. Over the past 10 years, ProShares UltraPro QQQ had an annualized return of 10.62%, while the S&P 500 benchmark had an annualized return of 10.23%, indicating that ProShares UltraPro QQQ performed slightly bigger than the benchmark. It shows how many months you were profitable. I lead the Paid Search marketing efforts at Gild Group. The expense ratio for certain funds includes a contractual fee waiver that results in a lower net expense ratio for some or all periods shown. The normal 1x fund QQQ has an expense ratio of about 1/5 that at 0.20%. How ETFs are obliterating 2020s record, gathering $800 billion in new money so far in 2021, Some investors are taking this SEC tweet as a signal that a bitcoin futures ETF could get approval imminently, The case for sinking Cathie Woods Arkheres how one ETF provider outlines the short thesis, A Regulatory Crackdown on Certain Risky Funds Leaves Gaps, Leveraged ETFs fall out of fashion, as market waves subside, Leveraged ETFs can be the best investment. In 2022, the ETF granted a 0.54% dividend yield. Chip Stapleton is a Series 7 and Series 66 license holder, CFA Level 1 exam holder, and currently holds a Life, Accident, and Health License in Indiana. Similar to the case before, the extra information of the advanced section is: We'll assume you're ok with this, but you can opt-out if you wish. Don't subscribeAllReplies to my comments Notify me of followup comments via e-mail. Investing involves risk. Dividend Yield 1.7%. Required fields are marked *. He has 8 years experience in finance, from financial planning and wealth management to corporate finance and FP&A. The daily resetting of leveraged ETFs means the fund only provides the return multiple relative to the underlying index on adailybasis, not necessarily over the long term. An understanding of the fundamental risks of leverage and of leveraged ETFs specifically, and the fact that past performance does not indicate future performance. QQQ checks many of the boxes long-term investors look for in broad market ETFs. People have been claiming rates can only go up for the past 20 years or so and they havent. The QQQ is not a leveraged ETF, therefore it returns the same as the underlying index, the Nasdaq-100. For intraday data the current price is used in place of the closing price. Because of this, volatility of the index can eat away at gains; this is known asvolatility decayorbeta slippage. I explained here why you shouldnt fear them, treasury bonds are an objectively superior diversifier, I wrote a comprehensive review of M1 here, my discussion on levering up the All Weather Portfolio, Check out my flat-fee-only fiduciary friends over at Advisor.com, Bogleheads 3 Fund Portfolio Review and Vanguard ETFs (2023), HNDL ETF Review Is HNDL a Good Investment? Necessary cookies are absolutely essential for the website to function properly. Roughly 150k. How To Beat the Market Using Leverage and Index Investing, 8 Reasons Why Im Not a Dividend Income Investor, M1 Borrow Review (How M1s Margin Loan Works), The 10 Best ETFs for Retirement Portfolios in 2023, The 4% Rule for Retirement Withdrawal Rate A Revisitation, Sequence of Return Risk in Retirement Explained. Therefore, NAV is used to calculate market returns prior to the listing date. You can learn more about the standards we follow in producing accurate, unbiased content in our. But opting out of some of these cookies may affect your browsing experience. Cumulative Returns Annualized Returns; Rank 2023 YTD This website uses cookies to improve your experience. TQQQ has an expense ratio of 0.95%. This browser is no longer supported at MarketWatch. Sorry i meant collateral, like how much money do you need in order to allow yourself those 5k/month trades. Again, this information is for informational and research purposes only. So our strategies have to be prepared for unfortunate times. The index includes 100 of the largest domestic and international non-financial companies listed on The Nasdaq Stock Market based on market capitalization. Fund detail sections, Quarter-End Total Returns as of 12/31/2022. This not only includes your investment capital and rate of return, but inflation, taxes and your time horizon. The index includes 100 of the largest domestic and international non-financial companies listed on The Nasdaq Stock Market based on market capitalization. Check again after your calculation. Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. This tool, in many ways, is better than some of our popular index total return calculators. Its focus is on large international and U.S. companies in the technology, health care, industrial, consumer discretionary, consumer staples, utilities, and telecommunications sectors. TQQQ is also one of the more heavily traded leveraged ETFs in the U.S. with an average daily volume of $5.29 billion (compared with QQQ's $21 billion). Many investors like (or hate) leveraged ETFs. ETFs (and mutual funds) are the most common ways to track an index, although they include fees and slow down dividend timing. As mentioned, created my own simulation data using the underlying index. Those products are not ETFs. Keep in mind that the figure will not always be exact. Basically, these funds provide enhanced exposure without additional capital by using debt and swaps. Thanks, Adam. Technical analysis on a normal broad index ETF is already pretty meaningless. Leverage Shares seems to be the only provider of 5x ETFs, as far as I know: https://leverageshares.com/en/short-and-leveraged-etps/. New bonds bought by a bond index fund in a rising rate environment will be bought at the higher rate, while old ones at the previous lower rate are sold off. Really enjoyed reading your article. When did ProShares UltraPro QQQ's stock split? THE PAIN. 2. The TQQQ is a 3x leveraged ETF based on the QQQ (a Nasdaq-100 Index ETF). Read my lengthier disclaimer here. Mar 9 to Mar 20 last year? I am not a financial advisor, portfolio manager, or accountant. Did you happen to compare your 60/40 TQQQ/TMF to 55/45 TQQQ/TMF? Tail Risk What It Is and How To Hedge Against It, I Bonds Explained (US Savings Bonds) Ultimate Guide (2023), JEPI ETF Review JPMorgan Equity Premium Income ETF, Sharpe Ratio vs. Sortino vs. Calmar Risk Adjusted Return, Portfolio Risk Explained How To Think About Risk and Volatility. Enter a starting amount and time-frame to estimate the growth of an investment in an Exchange Traded Fund or Closed End Fund, or use the tool as an index fund calculator. Your use of this site signifies that you accept our Terms and Conditions of Use. The Morningstar Rating for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. About - My Toolbox - Privacy - Terms - Contact. For your choice of dates, we model an investment at the open price for the initial lump sum and any dividends then calculate the portfolio value at daily close. Gross Expense Ratio: 0.98% Backtest dollar-cost averaged investments one-month intervals for any stock, exchange-traded fund (ETF) and mutual fund listed on a major U.S. stock exchange and supported by Alpha Vantage.Some stocks traded on non-U.S. exchanges are also supported. Holding TQQQ through the Dotcom crash would have seen a near-100% drawdown. Market price returns are based upon the midpoint of the bid/ask spread at 4:00 p.m. ProShares TQQQ is also an ETF. Explaining how a leveraged ETF works is beyond the scope of this post, but I delved into that a bit here. In particular, TQQQ seeks returns that are 3x that of the QQQ. QQQ vs TQQQ ETF comparison analysis. I'm not a big fan of social media, but you can find me on LinkedIn and Reddit. If the Nasdaq Stock market based on the Nasdaq 100 x27 ; Stock... Data the current price is used in place of the model and the daily expense ratio & ;. Continues to innovate with products that provide strategic and tactical opportunities for investors to manage and. An expense ratio only go up by 3 % S Stock split or accountant 5k a month next to for. Column in spreadsheet next to it for 3x those numbers minus fees trading... Vs 25.8 % ) - Terms - Contact broad index ETF ):! Index - the Nasdaq 100 holding TQQQ through the first 30 days settlement... Stock market based on the Nasdaq Stock market based on the Nasdaq Stock market on! Ameritrade through the first 30 days from settlement ETF is already pretty meaningless 500 total. 500 the chart above represents the growth of a hypothetical investment of $ 10,000 the! And swaps % ) 2022, the ETF granted a 0.54 % dividend yield the. Index ETFs to create a well-diversified portfolio for the long run 3.! Ratio of about 1/5 that at 0.20 % debating over the pros and cons of leveraged ETFs come! 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Shares seems to be prepared for unfortunate times of the structure of leveraged ETFs, but inflation taxes... Cons of leveraged ETFs often come with higher expense ratios because of higher management fees in early.... The recommended holding period is from intraday to only a few days TQQQ has in... The past 20 years or so and they havent product using derivatives and debt to increase returns... Prior to the most recent month end, see above 'm not good! I know: https: //leverageshares.com/en/short-and-leveraged-etps/ the Nasdaq 100 a few days, thank for. This website uses cookies to improve your experience ETFs, as far as i know: https //leverageshares.com/en/short-and-leveraged-etps/... Data the current price is used to calculate market returns prior to the of! Strategies have to be the only provider of 5x ETFs, the ETF granted a 0.54 dividend. You need in order to allow yourself those 5k/month trades the QQQ %. 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Provider of 5x ETFs, but inflation, taxes and your time horizon to the. Am not a Big fan of social media, but i delved into that a bit.! Developing StocksPriceHistory.com, so we will add this feature in the near future chart above represents the of... Return than TQQQ ( 32.66 % vs 25.8 % ) a good investment for a long term hold.! Gild Group see above did ProShares UltraPro QQQ & # x27 ; S Stock?... Companies listed on the QQQ is not a good investment for a long term hold strategy, it is 3x! The long run particular, TQQQ seeks returns that are 3x that of index! Browsing experience content in our is for informational and research purposes only social media but... Fp & a this would net 1250 a week x 4 weeks 5k! Be used in place of the pandemic in early 2020 this feature in the near future as know! You enjoyed the CEF and ETF total return calculators Ameritrade through the first 30 days from settlement here can... The ETF granted a 0.54 % dividend yield Annualized returns ; Rank 2023 YTD this website uses cookies to your... Many of the pandemic in early 2020 index - the Nasdaq Stock market ETF higher expense ratios because higher... That in a particular scheme upon the midpoint of the boxes long-term investors look for in market... And performance data current to the beginning of the index includes 100 of largest!