International Gold 3x Leveraged: A High-Risk, High-Reward Investment
International Gold 3x Leveraged (INTG) is an exchange-traded fund (ETF) that provides investors with exposure to the gold market with a leverage of 3:1. This means that for every 1% change in the price of gold, the value of INTG will change by 3%.
INTG is designed for investors who are looking for a way to amplify their returns on the gold market. However, it is important to note that this ETF is not suitable for all investors. Due to its high leverage, INTG can be a very volatile investment, and it is possible to lose money quickly if the price of gold falls.
How does INTG work?
INTG uses a combination of futures contracts and spot gold to provide leveraged exposure to the gold market. The fund’s manager will enter into futures contracts that are three times the size of the fund’s assets. This means that for every $100 of assets in the fund, the manager will enter into $300 worth of futures contracts.
The spot gold component of INTG is used to hedge against the risks associated with leverage. By holding a physical gold position, the fund can offset some of the losses that would occur if the price of gold falls.
What are the risks of investing in INTG?
The primary risk of investing in INTG is the volatility of the gold market. Gold prices can fluctuate significantly in a short period of time, and this can lead to large swings in the value of INTG.
Another risk of investing in INTG is the possibility of a “margin call.” A margin call occurs when the value of the fund’s assets falls below a certain level, and the fund manager is forced to sell assets to cover its losses. This can lead to a significant loss of value for investors.
Who should invest in INTG?
INTG is a suitable investment for investors who are comfortable with high levels of risk and who are looking for a way to amplify their returns on the gold market. However, it is important to note that this ETF is not suitable for all investors. Due to its high leverage, INTG can be a very volatile investment, and it is possible to lose money quickly if the price of gold falls.
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