The High-Risk Way to Profit From a Crash

With the S&P 500 (SNPINDEX: ^GSPC  ) having recently hit new record highs, many investors are starting to get nervous that a reversal of fortune for the stock market could be right around the corner. That has driven many profit-hungry investors to look at a potentially lucrative but high-risk strategy to bet on a sharp correction or outright market crash.

In the following video, Fool markets analyst Mike Klesta talks with Fool contributor Dan Caplinger about volatility-linked exchange-traded funds. As Dan discusses, volatility ETFs are designed to soar in value when stocks drop dramatically. But in the absence of a stock market crash, many of these investments have performed badly. Dan reveals one volatility ETF that has performed well and concludes with some guidance for those seeking to add volatility ETFs to their investment portfolio.

To learn about some other ETFs that have great promise for delivering profits to shareholders, check out The Motley Fool's special free report "3 ETFs Set to Soar." Just click here to access it now.


Read/Post Comments (0) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 2425259, ~/Articles/ArticleHandler.aspx, 7/24/2014 10:40:35 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement