Are ProShares Ultra ETFs Used As Hedging Devices By Money Managers? - SeekingAlpha: "Are ProShares Ultra ETFs Used As Hedging Devices By Money Managers?

Posted on Dec 18th, 2006 with stocks: DDM, DXD, QID, QLD, SDS, SSO

Brett Steenbarger submits: The ProShares Ultra ETFs enable traders and investors to leverage the movements of the major equity indices. For each 1% that an index moves, these ETFs will move 2%. This provides ETF traders with a degree of leverage normally associated with the trading of futures. Note that a pattern daytrader who qualifies for 4x leverage can reach 8x with the Ultra ETFs.

A unique feature of the Ultra ETFs is that they include separate trading instruments for long and short market exposure. By buying an inverse [short] ETF, a trader makes 2% when the underlying index falls by 1%. The non-inverse [long] Ultra ETF, of course, would rise 2% if the market rises by 1%.

Here are the symbols for the three most liquid Ultra ETFs:
NASDAQ 100: (QLD) [2x long]; (QID) [2x short]
S&P 500: (SSO) [2x long]; (SDS) [2x short]
Dow 30: (DDM) [2x long]; (DXD_ [2x short]

My initial idea was to compare volumes for the long vs. short Ultra ETFs to see if they functioned like call volume and put volume among options. In other words,..."