How-to · ETFs

ProShares UltraPro Short Dow30: A Week of -3x Daily Resets

ProShares UltraPro Short Dow30 starts every session from the previous close. Run a week through it by hand, close by close, and the weekly result stops being a mystery.

AI-assisted, reviewed by the TrueMoneyTrading human editor: John James → 5 min read Published

Short answer

Multiply each day's Dow change by -3 and apply it to wherever the fund closed the day before. In a steady decline SDOW can finish ahead of three times the Dow's weekly fall; in a week of reversals it can lose even when the Dow ends lower. Size the position for the one-day Dow jump you fear, at a loss you can take.

The Dow finished the week lower, and SDOW still lost money. The arithmetic behind that takes a table with a row for each session.

Every figure below is hypothetical. The index starts at 1,000 so the levels look nothing like a real Dow quote, the fund position starts at $10,000, and fees, trading costs and the small daily tracking differences of a real fund are all left out of the sums.

How do you work a week of -3x resets?

  1. Write down the index close for the Friday before the week and for each session in it.
  2. Turn each close into a percentage change from the close before it. Only the close before it.
  3. Multiply that change by -3 to get the fund’s target for the day.
  4. Apply the target to the fund’s value at the previous close. A $10,000 position that gains 6% on Monday starts Tuesday at $10,600, and Tuesday’s percentage works on $10,600, never on the original $10,000.
  5. At Friday’s close, compare the fund’s change for the week with -3 times the index’s change for the week, and read the gap between them as what the resets did on their own.

Every day went the fund’s way. So every day’s gain landed on a bigger base than the day before, and a bigger base means a bigger short exposure going into the next decline. Wednesday’s 6% earned $655.08. Monday’s 6% earned $600.

A choppy week: the Dow ends almost where it began

Here the Dow fell for the week and the bear fund still lost money.

Look at Monday and Tuesday. The index rose 2.5% and then fell 2.0%, leaving it 0.45% higher. Three times the opposite is a 1.35% loss. The fund was down 1.95% after those two sessions, because Tuesday’s 6% gain was earned on $9,250, a smaller pile than the $10,000 that took Monday’s 7.5% hit. Thursday’s 3% drop put the fund ahead for the week at $10,206.52. Friday’s 1% bounce then took 3% off, about $306, and left it below where it started.

Now flip the direction.

In a smooth rally against you, the fund loses a little less than three times the move, since each day’s 3% loss comes off a shrinking amount.

How do you read the result?

ProShares’ fund page for SDOW states the pattern in general terms. Smaller index moves and higher volatility tend to pull results below the daily target over longer periods, while larger moves and lower volatility tend to push them above it.

Put your own week to two questions. Did the Dow trend, or did it reverse? How large were the daily swings next to the net move for the week? Chop with a small net move is the worst case. Steady declines, day after day, are the best case. Most real weeks sit between the two, which is why the leveraged ETF decay calculator is worth running on a few paths before you decide how long to hold, and why volatility decay is the term to understand if the gap keeps surprising you.

Your own statement will not match hand-worked sums to the cent. The fund’s value is struck once a day at net asset value, you buy and sell at market prices that can sit slightly above or below it, and fees come out a little every day. Close enough is the goal. If a real week’s result sits far from your table, recheck the closes you used before blaming the fund.

How do you size SDOW for a single-day move against you?

  1. Pick the most you will lose in one session.
  2. Pick the Dow jump to plan for. Check the Dow’s average true range as a percentage of its level to see what an ordinary session looks like, then choose a jump several times larger.
  3. Multiply the jump by 3. That is the fund’s loss on that day.
  4. Divide the dollar loss by that percentage to get the most you can hold.
  5. Redo the sum after every winning day. A winning position grows, and so does its risk. Trim it back to the size your loss limit allows.

A stop order does not replace this step. News that lands after the close moves the Dow before the open, the fund opens wherever the index implies, and a stop-loss order sitting below the market fills at the first available price, which after a big gap can be far below the stop.

When can a -3x fund lose most of its value in one session?

When the Dow rises by about a sixth in a day. Halving SDOW takes a Dow gain of roughly 16.7% in one session, because 16.7% times 3 is 50%, and a gain approaching a third of the index’s value would take nearly everything the fund has.

The SDOW summary prospectus puts the last line in its own words: a Dow gain approaching 33% at any point in the day could cost your entire investment. A single-session move of that size in a 30-stock blue-chip index would be extreme. Smaller jumps still do plenty of damage, and the table shows how fast a -3x fund gives ground well before the extreme case arrives, especially for anyone who sized the position as if a 2% day were the worst on offer.

For the -2x and -1x Dow funds, which need larger rallies to do the same damage, read SDOW against DXD and DOG. Other indexes and multiples are on the inverse ETF list.

Questions traders ask next

How long can you hold SDOW?

As long as you like, legally. ProShares says holding longer than a day is up to your goals and risk tolerance, and warns that returns over any other period can land well above or below the daily target. Treat each extra session as a fresh decision and compare the fund with the Dow at every close.

Can SDOW go to zero in one day?

In principle, yes. The SDOW summary prospectus warns that if the Dow nears a one-third rise at any moment in a session, the whole investment could be lost. Smaller jumps still hurt badly: a 10% Dow rally takes about 30% off the fund, and a rally near 17% takes about half.

Why did SDOW lose money in a week when the Dow fell?

Because the week reversed several times on the way down. Each up day cut the fund from a larger value, and each down day added back a percentage of a smaller one. When the swings are big and the net move is small, those resets cost more than the slight fall in the Dow earns.