How to Profit Off of a Stock Market Downtrend

The market has had a terrible 2022 so far. The markets performed terribly, some stocks are down 70-90+%, and many investors have lost a relatively high percentage of their net worth. A lot of people, myself not necessarily included, believe that the market will continue to downtrend over the next year+, and for those that do believe such, here is exactly how to profit off of a market downtrend. I am not recommending that people make these investments as there is no way of knowing if this market downtrend will continue, but for those looking for ways to profit during a downtrend, here are some ways to do it.

1. SH

SH is the ticker name for the ProShares Short S&P 500 ETF. This fund shorts the S&P 500 which means that it profits when the S&P goes down in value. Since the market has had a very rough start to 2022, this fund has seen an increase of almost 19% this year. If one believes that this market downtrend will continue, this is a very good play to make.

2. SQQQ

SQQQ is the ticker name for the ProShares UltraPro Short QQQ ETF. This ETF shorts QQQ which is an ETF for technology stocks. Technology stocks have performed extra bad this year so far which has allowed SQQQ to increase by almost 105%. If one sees tech stocks continuing their decline, SQQQ allows one to take advantage of that happening. 

3. SARK

SARK is the ticker name for the Tuttle Capital Short Innovation ETF. This ETF shorts Cathie Wood's Ark Innovations ETF. While Ark performs really well in a bull market, it has performed terribly during this market downtrend. This has allowed SARK to grow by slightly over 102% since the beginning of 2022. If one believes that the market will continue to decline in value, this could be a very good play to make.

Again, I don't necessarily believe that this market downtrend will continue, but if one does think that way, these ETFs can help one profit from that.

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