ETF "double short" Question

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markraz
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ETF "double short" Question

Post by markraz »

I have a question about Short ETFs. REW in particular

https://finance.yahoo.com/quote/REW

This ETF has gone from over $1000 per share way down to $18.50. If the market keeps going up, this "short" ETF (among other like it) are going to keep going down. Eventually this ETF could go down under $1.00 if the market keeps going. What would happen at that point? In general stocks that drop down to a couple dollars per share eventually get de-listed form Nasdaq. I understand that scenario with a single company since it basically means the company is worthless as far as markets are equity concerned. However this is a different thing all together since it is compromised of many companies.

Can someone give me some insight of what would happen if this thing went under $1.00??

Thanks
DenisD
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Re: ETF "double short" Question

Post by DenisD »

I assume they would do a reverse share split or consolidation. IE, maybe 100 shares would become 1.
queerasmoi
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Re: ETF "double short" Question

Post by queerasmoi »

In fact REW has already reverse-split twice, in 2011 and 2014, 1:4 each time.

Fortunately this is only supposed to be a transitory instrument of speculation and not something you buy and hold.
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