3 Stocks to Short in Early 2026, and 3 ETFs That Make Betting Against Them Even Easier

Core Insights - The article discusses the concept of shorting stocks and ETFs, highlighting the risks associated with traditional shorting compared to using put options and inverse ETFs [1][2]. Group 1: Shorting and Investment Strategies - Traditional shorting involves borrowing shares and carries unlimited risk, while buying put options limits losses to the initial capital invested [1]. - The use of put options and inverse ETFs is emphasized as a more comfortable tradeoff, providing unlimited upside with limited downside [2]. - Leveraged inverse ETFs can be 2-3 times as volatile, serving as a potential replacement for options in volatile markets [3]. Group 2: Inverse ETFs - Inverse ETFs have been available for nearly 20 years, but a new generation aims to provide short-like exposure to individual stocks [5]. - The article highlights the importance of understanding the underlying stock when considering inverse ETFs, as their performance is closely tied to the stock's movement [6]. - Caution is advised when investing in these new inverse ETFs, as there is a learning curve involved [5].