SKF turns out to be a ticker for an Exchange Traded fund called UltraShort Financials ProShares. Take a look at its profile on yahoo.
The investment seeks daily investment results, before fees and expenses, which correspond to twice the inverse of the daily performance of the Dow Jones U.S. Financial’s 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 non-diversified.
I had a good laugh when I read its profile and thought the fund was some kind of scam. Please don’t be offended if you love the fund. I just don’t see the reason of such fund’s existing. To my surprise its daily volume is huge. Some 40 million shares changed hand today and the price was at $42.94. I am very skeptical about the fund because the strategy it takes is to go against the market for sake of going against it. I mean as an investor I want to buy a fund that can make me money not to going against the market. That is whole point of buying a fund right?
Think it in another way probably the fund is intended to be a hedging tool and its intention is not to grow asset or make money for investors. Still I think there are plenty of hedging vehicles in the market nowadays which can be tailor to suit different hedging needs. Why would people trade this fund which performance will be twice the inverse of the daily performance of the Dow Jones U.S. Financial’s index. Let me know if you see a reason. Take a look at its performance yesterday. It was down 7% versus the DOW’s gain of 2.37%
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