/biz/ - Business & Finance

>>17989145
Let's say the market goes down 10% and then up 11.11...% aka from 100$ to 90$ back to 100$.
That equals
(1-0.1)*(1+(1/9)) =1
I can do this as often as I want but the market stays at the starting value.
Like this:
((1-0.1)*(1+(1/9)))^x =1

The etf tracks the market returns but 3x.
(1-3*0.1)+(1+3*(1/9)) != 1
x-times chop gives:
((1-3*0.1)+(1+3*(1/9)))^x

See pic related:
Red line is market.
Green line is 3x etf
x is number of chops
tlrd: The 3x etf loses on chop