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The volume of NUGT at ~47m is much higher than DUST at ~7m. Why do traders favor one ETF so overwhelmingly? Is this typical of ETF pairs or just a quirk of NUGT/DUST?

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NUGT and DUST are opposites - DUST is a 'bear' (tracks 3x the inverse) and NUGT is a 'bull' (tracks 3x the actual). So if NUGT is much higher, sounds like people are betting on Gold (or specifically, on the NYSEARCA Gold Miners Index).

When this Investopedia article was written in July 2016, the volumes were reversed: DUST traded ~18m and NUGT traded ~7m. Just differences in stock market activity.

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  • I believe volume is usually not considered a bullish or bearish indicator in the way you imply. For every person "betting on gold", as you say, by buying NUGT one person (seller) is betting against. The net bets are always zero.
    – Superbest
    Commented Jan 31, 2017 at 22:09
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    You're not taking inflow and outflow into account though. More DUST will be created when more bullish bets are made (as the market makers will always create more bundles as long as the price is right). Since no sane person holds onto these securities for long, tons of shares need to exist in a bear market for gold (mining) - and inverse for NUGT. It's not perfectly matching (you might see some inflow to both for example if more speculation is going on in general).
    – Joe
    Commented Jan 31, 2017 at 22:21
  • But is it because people prefer buying NUGT to shorting DUST or options?
    – Superbest
    Commented Feb 2, 2017 at 17:10
  • Shorting leveraged ETFs is not exactly like shorting regular stocks. You don't want to long-term short them (any more than you want to long-term hold them) - you should only be day-trading the options just as you day-trade the fund. But since the option prices don't perfectly mirror the fund prices (as they're future options), they're just two different things. (Also, I tend to think of options as more risk than the underlying fund - and NUGT/DUST are super-risky to begin with being triple-leveraged. So many people may prefer not to trade options for that reason.)
    – Joe
    Commented Feb 2, 2017 at 17:59
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NUGT and DUST both track GDX with triple leverage, but in opposite directions. GDX has been rising steadily throughout 2016, and certainly since over the last month. DUST experiences much higher volume when GDX is in a downward trend, as it was from 2013-2016. I think you'll see the same thing with DRIP and GUSH when oil has been moving steadily in one direction or the other. This is really a reflection of the herd mentality to jump in when things look like they're going a particular direction.

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