Bitcoin Calls Are Cheap, Equity Puts Are Rich | Dean Curnutt on TACO, Variance Drag, Leveraged ETFs, and Cross Asset Vol
Monetary Matters with Jack Farley
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Understanding Variance Drag and Its Impact on Leveraged ETFs
This chapter explores the risks of double-leveraged ETFs, particularly highlighting how variance drag can diminish returns on volatile assets. The hosts caution against long-term holding of these products, explaining the critical differences between arithmetic and geometric returns.
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