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QQQ (Nasdaq 100) @ $179 QQQ3 (Nasdaq 100 x 3) @ $915

March 17, 2020

The last time I said to buy these two ETFs, which track the Nasdaq 100 has proved a disaster. Under pressure from the Covid-19 virus outbreak chunks of the global are shutting down. I don’t know how it is all going to pan out. It’s a major short-term setback but humans are resourceful creatures. We are surely going to get on top of this at some point. Trading results for many Nasdaq 100 companies are going to be affected but by the time they start reporting the news they may have something more cheerful to say about light at the end of the tunnel. If they do shares will be climbing again and recovery could be surprisingly swift.

One thing about which we can be almost certain is that the effects of Covid-19 will be temporary; that means that eventually the equity bull market will resume and we may still have near zero interest rates and powerful fiscal stimulus in place.

So I think it could be a good time to snap up a few of these ETFs, if only in the spirit of averaging down. The Nasdaq 100 is not going to go bust yet QQQ3, the three times leveraged version of the QQQ ETF, is down from a peak $2,586.46 to $915, after being as low as $793, which is where they were when I started thinking of recommending them. This incredible fall has come in just 19 trading days.

There is no particular logic for buying the shares now, no buy signal or good news about the virus being in retreat. I just have a hunch that buying a few now could look timely a year or two from now.

Somebody said about the stock market that you should be fearful when others are greedy and greedy when others are fearful. They are certainly fearful now. Hence my idea that buying into these two ETFs could be a timely thing to do.

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