Core Insights - A 3x leveraged product tied to AMD has gone to zero, resulting in significant losses for investors who bet against the chipmaker following a surge in AMD's stock price after its deal with OpenAI [1][5][6] Group 1: Company Developments - AMD signed a deal with OpenAI to deliver 6 gigawatts of GPUs over the next several years, potentially generating tens of billions of dollars in revenue for AMD [5] - Following the announcement, AMD's stock surged more than 37%, benefiting AMD shareholders but adversely affecting those who were shorting the stock through leveraged products [6] Group 2: Investment Product Risks - The collapse of the GraniteShares 3x Short AMD Daily ETP serves as a cautionary tale about the risks associated with leveraged and inverse ETFs, which can magnify losses and lead to total investment loss [2][3] - A 33⅓% gain in AMD's stock resulted in a 100% loss for the 3x short product, triggering an "index cancellation redemption event" that led to the fund's liquidation [7] - Leveraged ETFs do not invest directly in underlying stocks but rather in derivatives designed to provide exposure to the stock's performance, resetting their leveraged exposure daily [8]

On October 7, gold hit $4,000 an ounce for the first time ever. It marks the latest milestone in an incredible rally that has resulted in gold prices rising 50% so far in 2025. There are a few reasons for the strength in gold: Safe haven demand: Concerns about the labor market slowing, stubborn inflation, and weakening worldwide demand have resulted in some investors taking risk off the table. Central bank buying: Global central banks have been increasing their gold reserves throughout the past year as ...

Core Viewpoint - Leverage is not a shortcut to wealth but a double-edged sword that amplifies both risks and returns, often leading to significant losses in volatile markets [7][8]. Group 1: The Nature of Leverage - Leverage itself does not create value and is not a low-risk, high-return arbitrage tool [8]. - Leveraged ETFs experience "volatility drag," which erodes returns over time, especially in fluctuating markets [9][28]. - The asymmetry of gains and losses is exacerbated by leverage, making it more challenging to recover from losses [12][17]. Group 2: Risks of Leveraged ETFs - A 3x leveraged ETF can theoretically become worthless if the underlying index drops more than 33.33% in a single day [14]. - The concept of "fixed leverage trap" indicates that after a loss, the base for future leverage is reduced, complicating recovery [17]. - High management fees and tracking errors in leveraged ETFs further diminish returns, akin to physical energy losses [21]. Group 3: Historical Performance and Market Conditions - The 3x leveraged semiconductor ETF (SOXL) has shown impressive annualized returns of over 30% in certain periods, outperforming broader indices like NASDAQ and S&P 500 [23][40]. - However, the extreme volatility and significant drawdowns, such as in 2022, highlight the risks associated with leveraged products [26][40]. - The timing of market conditions is crucial for leveraged investments, making long-term holding risky [27][41]. Group 4: Guidelines for Ordinary Investors - Leverage amplifies both risk and reward, making it essential for investors to approach it with caution [47]. - The long-term viability of investments should focus on value creation rather than merely leveraging returns [53]. - Ordinary investors are advised to avoid heavy leverage and to prioritize survival and long-term investment strategies over short-term gains [55].

Group 1 - The article discusses the potential risks and pitfalls of using leveraged ETFs, particularly those that aim to provide three times the daily return of the semiconductor index [1][2][3] - Leveraged ETFs do not create value and are not a low-risk, high-reward arbitrage tool, as they amplify both gains and losses [2][30] - The concept of "volatility drag" is introduced, explaining how daily resetting of positions can lead to significant losses over time, especially in volatile markets [3][6][24] Group 2 - A mathematical example illustrates that a 10% gain followed by a 10% loss results in a net loss for both the underlying asset and the leveraged ETF, highlighting the asymmetrical nature of returns [4][5] - The article emphasizes that leveraged ETFs have a "path dependency," meaning their final returns are highly influenced by the specific daily price movements [7][19] - The extreme risk of leveraged ETFs is underscored by the fact that a single-day drop of over 33.33% in the underlying index could theoretically render the ETF worthless [8][9] Group 3 - Historical performance data shows that while a specific three-times leveraged semiconductor ETF has had impressive annualized returns over various time frames, these returns are not guaranteed to continue [19][20][35] - The article warns that the high volatility and potential for significant drawdowns, as seen in 2022, make these products unsuitable for long-term holding [22][36] - It is suggested that such leveraged products are more appropriate for short-term trading or very small allocations due to their heightened risk compared to broad market indices [25][34] Group 4 - The article draws parallels between physics and finance, stating that relying solely on leverage for excess profits is akin to believing in a perpetual motion machine [13][15] - The high management fees associated with leveraged ETFs, such as a 0.75% fee for SOXL compared to 0.03%-0.2% for regular ETFs, further erode potential returns [17] - Regulatory warnings indicate that leveraged ETFs are not suitable for long-term investment strategies [18][34]

最近跟着某大V买入两倍做空恒生科技ETF 07552作为港股的对冲仓位。对于杠杆ETF的磨损成 本之前有所耳闻，但具体多大没有量化过。今天拿两倍做空恒科和做多恒科画了一张图，简直震 惊了。 上图是17年至今这两个ETF的数据，发现平均值（绿线）是先跌后涨的，趋势基本和做多恒指 03037是一致的，这难道说明1倍做多恒指跟踪得好点，1倍做空恒指跟踪得差一点？ 最后，本文的目的是，提醒一下买带杠杆ETF的同学：阿祖，醒醒吧，别买了，损耗太大了。 拉格纳罗斯 美股的三倍做多纳指，tqqq。很多大v都在推，用来对冲之类的。但我就信一条。纳指这么大牛 市。他是三倍杠杆，市值竟然只有30亿。看曲线，也没看出来纳指的三倍牛市，咱也不懂，咋也 不问。但咱知道，不懂不做。 这次惊人地发现，1倍做空恒指07300和1倍做多恒指03037的每日平均值居然是上升的，由11.4 涨到了12.9，涨幅为13%，好嘛，买点做空的ETF对冲，除了实现对冲，该做空产品未来期望居 然还是涨的。 如果完全没有磨损的话，那么两倍做空07552和两倍做多07226的平均值那条线（即上图绿 线），就应该是一条笔直的水平线，但是过去一年，这个平均值居然由 ...

Core Viewpoint - Nvidia's stock has seen a significant decline of 23% over the past year, currently priced at $94 per share, raising concerns about its future performance amidst changing market dynamics and competition [3][4]. Group 1: Recent Developments - Recent reports indicate that Microsoft has slowed its data center expansion, which could negatively impact Nvidia's growth prospects [7][8]. - Microsoft's CEO expressed skepticism about the immediate financial benefits of AI, suggesting a potential slowdown in capital expenditures across the tech industry [8][9]. - Nvidia's current market capitalization of $2.5 trillion reflects expectations of sustained high sales, but any slowdown in revenue growth or profit margins could lead to significant financial losses for the company [8][9]. Group 2: Capital Expenditure Trends - Analysis of major tech companies' capital expenditures from FY16 to FY24 shows a marked decline in spending, particularly in FY20 and FY23, with a potential reversal in FY24 due to AI developments [9]. - The total capital expenditures for major tech firms in FY24 are projected to be $217.267 billion, a significant increase from previous years, but this trend may not continue if stock prices and financial performance decline [9][10]. Group 3: Market Sentiment and Risks - The recent downturn in large tech stocks, including Nvidia, reflects broader market trends, with the Nasdaq index dropping over 20% from recent highs [9]. - The potential for Nvidia's stock to face long-term challenges is highlighted by comparisons to Intel's historical performance, where revenue recovery did not lead to a return to previous market valuations [13][15]. - The influx of retail investors into leveraged ETFs related to Nvidia may indicate market exuberance, which often precedes market corrections [22][23]. Group 4: Future Outlook - Despite the current challenges, there are expectations for AI applications to grow exponentially, which could sustain demand for Nvidia's chips and maintain its competitive edge [23]. - However, the recent decline in Tesla's stock serves as a cautionary tale, emphasizing the volatility and risks associated with high-growth tech stocks like Nvidia [23].