DataTrader: UltraShort Real Estate’s Extreme Retreat

Heading into the final trading day of the week, there is no more oversold exchange-traded fund than the ProShares UltraShort Real Estate ETF (SRS).

To be sure, the SRS has plenty of company. When the Dow industrials makes a 300-point move higher, exchange-traded funds that track the inverse of major market indices will move aggressively lower – with the leveraged versions of these ETFs leading the way.

The ProShares UltraShort Real Estate ETF is a good example of this. Down well over 8% on Thursday, shares of SRS finished at their lowest levels of the year, taking our previous extreme lows from July. This selling has helped SRS earn a two-point upgrade to our highest rating, 10 out of 10, going into trading on Friday.

This is the highest rating the ETF has earned in months. The last time SRS was rated nearly as high was back in late August and again in mid-September. In August, an upgrade to 9 out of 10 anticipated a three-day gain of nearly 10%. An upgrade to 9 in September was all it took to send shares of SRS higher by more than 14% in three days.

As always, it remains to be seen if SRS will react to its latest upgrade the way it has in the most recent past. But for traders who feel as if the surge higher on Thursday left them with few good ideas for trading over the next few days, the increasingly extreme levels in exchange-traded funds like SRS may be a good place to look.

Quantified data and research on exchange-traded funds like SRS is available each evening after the market close. To learn more, click here.

David Penn is Editor in Chief of