Why does the sqqq not go down the same amount as the tqqq goes up?

The ProShares UltraPro QQQ (TQQQ) and the ProShares UltraPro Short QQQ (SQQQ) are both ETFs that have a leverage ratio of 3, which means they amplify the movements of the NASDAQ-100 INDEX by a factor of 3. However, the SQQQ does not go down the same amount as the TQQQ goes up because they have opposite investment directions and leverage ratios that are equal in magnitude but opposite in sign. 1. **Understanding the Leverage Ratio**: The leverage ratio of 3 means that for every 1% change in the NASDAQ-100 INDEX, the TQQQ will move by 3%, while the SQQQ will move by -3%. This is because the SQQQ is shorted the index, meaning it has a negative position, which results in a decrease in value when the index goes up. 2. **Opposite Investment Directions**: The TQQQ has a long investment direction, which means it aims to increase in value as the NASDAQ-100 INDEX goes up. In contrast, the SQQQ has a short investment direction, which means it aims to decrease in value as the NASDAQ-100 INDEX goes up. This is why the SQQQ does not go down the same amount as the TQQQ goes up; it is designed to move opposite to the index's movements. |code|Ticker|Name|Investment Direction|market_code| |---|---|---|---|---| |SQQQ|SQQQ.O|ProShares UltraPro Short QQQ|Short|185| |TQQQ|TQQQ.O|ProShares UltraPro QQQ|Long|185|