An ETF is the acronym for Exchange Traded Fund.  An ETF operates similarly to a mutual fund since both have diversified stock holdings.

An inverse ETF is an exchange traded fund (ETF) which profits from a decline in the value of a basket of stocks. Should the basket of stocks decline by 10%, the shares of the inverse ETF would increase by 10%.

A leveraged exchange-traded fund (ETF) uses financial derivatives and debt to amplify the returns of an underlying index. A traditional ETF tracks the securities in its underlying index on a 1:1 ratio.

A 200% (aka. 2X or 2:1 ratio) leveraged ETF tracks the securities on a 2:1 ratio and a 300% leveraged ETF on a 3:1 ratio.  If the securities of an underlying index increase by 10%, the share price of a 300% leveraged ETF would increase by 30%.

An order to execute a trade should be entered within 15 minutes.

The Bear Trader alert will provide the instructions.  The instructions will state to purchase at market price or will include a price limit.

An @ market order is to buy or sell shares at the prevailing market price. The majority of Bear Trader’s text messages to Bear Trader and Bear Trader Premium subscribers include instructions to buy or sell shares @ market from 3:00PM to 4:00PM.

Bear Trader Pro subscribers receive @ market instructions from 9:30AM to 4:00PM. To learn why the entry of @ market orders throughout the trading day enhances performance, see FAQ: “What is the advantage of utilizing “@ market” orders throughout entire trading day?

Note. For best performance, Bear Trader and Bear Trader Premium subscribers should enter orders to buy shares within 10 minutes of receiving a text message.  If subscribers can-not buy shares within 10 minutes they should abort and wait for next text messaged instruction to buy shares.

Bear Trader Pro subscribers receive @ market share buy and sell instructions throughout the trading day and from 9:31AM to 4:00PM.  Due to volatility and the fluctuations which can occur after the market opens Bear Trader Pro traders can potentially buy their shares at lower prices and sell their shares at higher prices during the 9:31AM to 3:00PM window.

Additionally, due to the window being open the entire trading day Bear Trader Pro subscribers receive more alerts than Bear Trader and Bear Trader Premium subscribers.  Finally, Bear Trader Pro subscribers who have margin accounts could potentially receive text messages to buy and sell shares in the same trading day.

The term “conservative trader” is utilized by Bear Trader to classify the unleveraged ETFs that are recommended to investors who are somewhat risk-averse. The price and percentage change for an unleveraged ETF increases or decreases proportionally to the index it tracks.

For example, the SPY is an unleveraged long ETF which tracks the S&P 500. When the S&P 500 increases by 10%, the SPY ETF increases by 10%. Conversely, when the S&P 500 declines by 10%; the share price of SPY declines by 10%.

Unleveraged ETFs rank among the least risky of all investments since the indices they track rarely go up or down 5% in a day or even a week.

The term “aggressive trader” is utilized by Bear Trader to classify the leveraged ETFs that are recommended to investors who want higher returns. The price and percentage change for a leveraged ETF increases or decreases at a proportion which is at a multiple of the index it tracks.

For example, the SPXL is a triple leveraged long ETF which tracks the S&P 500. When the S&P 500 increases by 10%, the SPXL ETF increases by 30%. Conversely, when the S&P 500 declines by 10%; the share price of SPXL declines by 30%.

Even though leveraged ETFs have higher risk than unleveraged ETFs, they are less risky than individual stocks. Also, the indices they track rarely go up or down 5% in a day or even a week.  

The Bear Trader provides instructions including the symbols for the ETFs for both conservative and aggressive traders.

The ETFs that it instructs conservative traders to buy and sell are unleveraged. Thus, should the index increase by 10% after the Bear Trader has sent instructions to purchase a single leveraged long ETF such as the SPY, its share price would also increase by 10%.

For aggressive traders, the Bear Trader instructions are to buy and sell 300% or triple leveraged long and short or short ETFs. Should an index decrease by 10%, a triple leveraged inverse ETF would increase by 30%. Leveraged ETFs are much riskier. Should an investor hold a 300% leveraged inverse ETF and should the index increase by 10%, the price of the ETF would decline by 30%.

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