ProShares UltraShort SmallCap 600 (NYSE: SDD) — This inverse ETF is composed of financial instruments with economic characteristics that should correspond to twice the inverse daily performance of the S&P SmallCap 600 Index (SML).
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Since the bottom of the recent bear market in March 2009, this contra ETF sold at over $120 and then fell to a recent low of $16.97 on May 6, 2010. But now, with the possibility of a significant correction in small-cap stocks at hand, this ETF could give traders a quick, 4-point trade.
Note the pending stochastic buy support by a Collins-Bollinger Reversal (CBR) buy signal (our proprietary indicator) and strong accumulation since early last week.
This is a speculative, leveraged ETF that is primarily suited to day trading. Be sure to check for any special margin requirements and, recognizing the high risk of this trade, place a stop-loss order at the time of execution.
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