Unusual Investments

Alternative Investments | 150 ways to invest your money

150 Types of Alternative Investments – The List

72. Leveraged ETFs – exchange traded funds (ETFs) consist of a basket of stocks, not unlike a mutual fund, but in a more liquid form and often at a lower cost.

With leveraged ETFs, an investor can take advantage of leverage to amplify returns if they underlying stocks appreciate.

If someone is extremely confident that a particular industry or the market as a whole will go up, the extra leverage allows them to magnify their upside potential.  The downside is that they could suffer a loss that is double or triple what they would have lost with a regular, unleveraged ETF.

Investing in leveraged ETFs is riskier than a regular ETF because money is borrowed to amplify returns.

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