RESOLVING THE LEDGER
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Choosing between Vanguard Financials ETF (NYSEMKT:VFH) and ProShares - Ultra Financials (NYSEMKT:UYG) involves weighing the benefits of a low-cost, broad-market index fund against a highly volatile leveraged tool designed for short-term traders.
The financial sector encompasses everything from global banking giants to regional lenders and payment processors. Investors looking for exposure here could choose VFH for market-tracking stability or UYG for amplified daily returns. While VFH tracks a market-cap weighted index for long-term growth, the ProShares fund seeks double the daily return of its benchmark, which introduces risks from leverage decay over longer periods.
Beta measures price volatility relative to the S&P 500; beta is calculated from monthly returns over the available fund history (up to five years). The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield as of the close of trading on July 23. Dividend yield for UYG excludes a short-term capital-gains payout to shareholders.
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