1-Star ETFs Poised to Plunge: ProShares Short MidCap 400?


Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, ProShares Short MidCap 400 (NYS: MYY) has received the dreaded one-star ranking.

With that in mind, let's take a closer look at the ProShares ETF and see what CAPS investors are saying about it right now.

MYY facts


June 2006

Total Net Assets

$25.4 million

Investment Approach

Seeks daily investment results that correspond to the inverse (-1x) of the daily performance of the S&P MidCap 400 Index. The index is a widely used measure of mid-size company U.S. stock market performance.

Expense Ratio


1-Year / 3-Year / 5-Year Returns

(25.1%) / (17.9%) / (12.0%)


ProShares UltraShort S&P500
ProShares Short S&P500
Direxion Daily Small Cap Bear 3x Shares

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 44% of the 385 members who have rated the ProShares ETF believe it will underperform the S&P 500 going forward.

Just last week, one of those Fools, All-Star TerryHogan, succinctly summed up the bear case for our community:

Contractual waiver on the expense ratio is done at the end of September, that's when the underperformance of this dud will really start to sparkle. Expenses will go from 0.95% to 1.25% (or more maybe?). Plus, the mid-cap 400 is not something I want to bet against. Also this thing tries to match the inverse return daily, so with volatility over time this thing will not do well.

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The article 1-Star ETFs Poised to Plunge: ProShares Short MidCap 400? originally appeared on Fool.com.

Fool contributorBrian Pacamparaowns no position in any of the companies mentioned. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Fool'sdisclosure policyalways gets a perfect score.

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