Loading ...JNUG is an exchange traded fund (ETF) , and as you indicate , aims to be 3X leveraged to junior gold miners , so is quite volatile . The junior gold miners are volatile to begin with , so I assume the ETF deals in options or futures to achieve their stated goal . Every time I add to my position Schwab always indicates that leveraged ETF’s are not for all investors , and generally not to be held overnight , but I do . The gain on Friday was over 8% .
You are correct that you cannot lose more than a portion of your investment in JNUG .
The advantage to ETF’s is that they are traded all day long , not like Mutual Funds which trade only after markets close , based on the Net Asset Value at the end of the day . You have to guess at the price of a Mutual Fund during the day , enter a bid in dollar terms of how much you wish to spend , then learn later after the NAV is determined , how many shares your $$$ bought . With an ETF , you specify either a market order , or a limit order , and the number of shares you wish to bid on .
If JNUG goes back to the price of about five years ago the potential gain is over 10 000 % ! I do not see how it can lose more than 50% of the current price , unless the Juniors go belly up en masse .
I hope this helps , but R640 is the expert on this ETF .