Is JNUG a good stock to buy?
But there are also good reasons to expect the JNUG ETF is headed lower in the medium-term. In addition, the price of gold will likely underperform in the long-term. At this point, gold is a great medium-term trade, but a terrible long-term investment. But the JNUG ETF is too dangerous to hold even in the medium-term.
Why is JNUG stock so low?
Leveraged ETFs like JNUG get crushed in a volatile market. One reason for this is because the JNUG ETF uses leverage, that leverage has to be rebalanced every day. The long and short of it is that with leveraged ETFs, the more volatile the benchmark, the more value tends to get lost over time.
What causes JNUG to go up?
In other words, JNUG is constantly selling lower-priced expiring contracts and buying higher-priced futures contracts to replace them. Contango is the primary reason why the GLD ETF is up 48.9% since the beginning of 2014 and JNUG is down 99% in that same time.
What companies are in JNUG?
Top 3 Holdings
| Company | Symbol | Total Net Assets |
|---|---|---|
| Dreyfus Government Cash Management Institutional Shs | DGCXX | 50.73% |
| VanEck Junior Gold Miners ETF | GDXJ | 36.29% |
| Financial Square Treasury Instruments Fund FST Shares | FTIXX | 19.45% |
What kind of ETF is JNUG?
JNUG is the triple-leveraged answer to the VanEck Vectors Junior Gold Miners ETF (GDXJ), an ETF with a three-year standard deviation of just over 50 percent.
Does JNUG decay?
Both of these ETFs are best suited for day trading purposes, with a full acknowledgment of the potential risks. With these risks acknowledged, investors should also realize that holding a leveraged ETF such as NUGT or JNUG on a longer time scale is not a wise choice, due to the detrimental effects of decay.