Sir this is a casino.
Morningstar: ‘Is this a stock market, or a casino?’ New 4X leverage S&P 500 ETN met with caution
“An exchange-traded product that allows investors to place massively leveraged bets on the S&P 500 launched on Tuesday, according to a news release from the sponsor, Bank of Montreal.
It is called the MAX S&P 500 4X Leveraged Exchange Traded Note XXXX, and it will offer investors daily returns four times that of the S&P 500 Total Return Index. The fund’s sponsor, Max ETNs, already offers four other leveraged ETNs offering 3X exposure to the airline and auto industries.
The ETN started trading Tuesday on NYSE Arca using the ticker “XXXX.”
Sponsors of the product heralded it as an “innovative tool” for investors.
“With the launch of these 4X leveraged ETNs, we continue to foster a diversified and dynamic investment landscape,” said Adam Stempel, managing director of BMO Capital Markets, in a news release. “As investors seek strategies to navigate evolving market conditions, we provide access to innovative tools designed to meet their various needs.””
h/t jhonkas