My day-trading friends and I love and respect the triple leveraged ETF's. Their ability to make respectable gains on modest investments, and ability to loose principle quickly are fantastic - borderlineing on outrageous.
In broad market terms, the financial sector can be measured by observing the Financial Select Sector SPDR, market symbol: XLF. This SPDR moves a dollar for every dollar that the average financial stock moved. There is an ETF that moves two dollars for one dollar move of the XLF. My favorite is FAS which moves three (count them three) dollars for every one.
With that ETF, we can, for the same amount of time, energy, and money, reap tripple the rewards. The pesimist would say that it enables us to loose money three times as fast. They would be right.
Now for the rest of the story and to please the pesimist:
When the market takes a downturn, the nimble trader can sell his bullish position and enter a bearish one... the FAZ. This ETF is the opposite of the FAS, it gains three dollars when the sector average looses one.
With this power duo, in a volitile market, in a volitile sector, how could a nimble and observant trader fail?
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