Local Degen Diversifies Into Three Different Leveraged ETFs Tracking the Same Index
Risk management, he explained, is about spreading your exposure across multiple tickers.
Satire
A local trader announced this week that he has finally gotten serious about diversification, allocating his portfolio evenly across three different 3x leveraged ETFs that track the same underlying index.
You do not want all your eggs in one basket, he explained, gesturing at three baskets that are the same basket. If one of them has a bad expense ratio day, the others are there to catch me.
The trader, who describes his risk tolerance as aggressive but responsible, went on to describe his hedging strategy, which consists of a stop loss he moves lower every time it is about to trigger.
At press time he was researching a fourth fund, describing it as uncorrelated because it has a different logo.