(HQD) BetaPro NASDAQ-100 -2x - Ratings and Ratios

The BetaPro NASDAQ-100 -2x Daily Bear ETF (HQD) is an exchange-traded fund designed to provide inverse exposure to the NASDAQ-100 Index, with a leverage of 2 times the daily inverse performance. This means that for every 1% decline in the NASDAQ-100 Index, HQD is designed to rise by 2%, before fees and expenses.

As a leveraged inverse ETF, HQD is intended for sophisticated investors who seek to hedge against or speculate on the decline of the NASDAQ-100 Index. The fund achieves its objective through the use of derivatives, such as futures contracts and swap agreements. Its essential to understand that the use of leverage amplifies the potential gains but also increases the risk of significant losses.

Analyzing the current market conditions and the funds recent performance, we observe that the last price is 9.16 CAD, which is below its 20-day, 50-day, and 200-day Simple Moving Averages (SMA). This indicates a bearish trend. The Average True Range (ATR) is 0.83, representing a 9.04% daily price movement, suggesting high volatility. Given these technical indicators, its likely that the fund will continue to experience significant price swings.

Considering the Assets Under Management (AUM) of 59.36M CAD, the fund has a relatively modest size, which may impact its liquidity and trading costs. However, this does not directly influence its ability to track the inverse performance of the NASDAQ-100 Index.

To forecast HQDs future performance, we need to examine the outlook for the NASDAQ-100 Index. If the index is expected to decline, HQD could potentially benefit from its inverse exposure. Conversely, if the index rises, HQDs value is likely to decrease due to its leveraged inverse nature. Based on the current technical data, including the SMA and ATR, and assuming a continued bearish trend in the NASDAQ-100 Index, HQD may experience a short-term increase. However, the long-term performance will depend on the indexs overall direction and the funds ability to maintain its inverse exposure.

Using a combination of technical and fundamental analysis, a potential forecast for HQD could be: if the NASDAQ-100 Index experiences a significant decline, HQD could see a substantial increase in value, potentially breaking above its 52-week high of 15.26 CAD. Conversely, if the index rallies, HQD may decline further, potentially testing new lows. Investors should closely monitor the indexs performance and adjust their strategies accordingly.