Stocks & Equities

Educational Article About Trading Leveraged ETFs using ADX Indicator

While working for a trading simulation company, I regularly contributed some educational articles on their official blog.

4 Tips to Trade Leveraged ETFs with Directional Movement Index

Excerpt:

you should individually assess the leveraged ETF risk. Because if you trade UWTI and NUGT with the same trend trading strategy, it would be suicidal. Because NUGT price tends to have a more range bound price action, while the UWTI would likely establish a trend during the trading day.

Now that you know what to look for in a leveraged ETF to classify it as suitable for trend trading, visit ETFdb’s leveraged ETF list and cross check the beta of the leverage ETF in order to cherry pick the most volatile ones. You should remember that a beta above 1 indicates a higher volatility compared to the market, where and a beta below 1 indicates that it has a lower volatility compared to the market.

You can read the full article here.

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes about various tech and financial topics. You can reach him at contact@asifimtiaz.com

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