#bstockscis @BinanceCIS
$MVLLB — a completely different beast among bStocks. This is not a stock and not a standard ETF, but a leveraged product: 2x on the daily move of Marvell (MRVL). It sounds like “double the returns,” but there’s a catch that very few people notice.
The leverage is recalculated every day, and because of that, in a volatile market you get a “drawdown effect” (decay) — even if the underlying stock ultimately returns to its starting price, the leveraged fund can still end up down. An example from the issuer itself: if MRVL drops by 10% in one day and then rises by 11.11% the next day (the stock returned exactly to where it started), MVLLB will still lose about 2.2% over that time, simply due to daily compounding. This isn’t a bug; it’s explicitly spelled out in the prospectus — the fund is not physically intended for long-term holding, only for short trades.
For me, $MVLLB is more of a tool for intraday trading—or at most a couple of days of speculation on Marvell’s move—rather than a “buy and hold” portfolio position, like the other bStocks in my basket.
Poll:
What’s your take on leveraged bStocks like MVLLB?
•Only for short trades
•Too risky, don’t touch
•Already tried it — I know about decay
•First time hearing about this kind of mechanism
$MVLLB — a completely different beast among bStocks. This is not a stock and not a standard ETF, but a leveraged product: 2x on the daily move of Marvell (MRVL). It sounds like “double the returns,” but there’s a catch that very few people notice.
The leverage is recalculated every day, and because of that, in a volatile market you get a “drawdown effect” (decay) — even if the underlying stock ultimately returns to its starting price, the leveraged fund can still end up down. An example from the issuer itself: if MRVL drops by 10% in one day and then rises by 11.11% the next day (the stock returned exactly to where it started), MVLLB will still lose about 2.2% over that time, simply due to daily compounding. This isn’t a bug; it’s explicitly spelled out in the prospectus — the fund is not physically intended for long-term holding, only for short trades.
For me, $MVLLB is more of a tool for intraday trading—or at most a couple of days of speculation on Marvell’s move—rather than a “buy and hold” portfolio position, like the other bStocks in my basket.
Poll:
What’s your take on leveraged bStocks like MVLLB?
•Only for short trades
•Too risky, don’t touch
•Already tried it — I know about decay
•First time hearing about this kind of mechanism