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1.
Leveraged inverse exchange-traded funds aim to provide _______.
Several times an index's return. They aim for two or three times the index's return.
2.
Futures-based, long-commodity exchange-traded funds work best as what kind of strategy?
Tactical. The other terms refer to currency-oriented ETF strategies.
3.
In order for an inverse exchange-traded fund to provide several times an index's return, it must use leveraging.
True. Along with compounding, such a fund would use leverage to achieve its aim in a bear market.
4.
What does a buy-write stock-index strategy do?
Sells call options on a stock index. A buy-write or covered-call writing strategy writes or sells call options on a stock index, such that if the call is exercised, it is "covered," and the cash-value of the index can be delivered to the holder of the option. The premium received from writing the calls provides some protection against losses on underlying stock index, but also caps the gains on the index.
5.
Inverse exchange-traded funds offer _______.
The exact opposite return of a particular index. Thus the name 'inverse.'
