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Mary Hanley Comment On Regulatory Notice 22-08

Mary Hanley
N/A

How much do the $'s spent by Americans on sports betting or lotteries help produce a cleaner/greener energy America? Those $'s are better spent on ERX ($58/sh) & ERY ($5/sh). ERX is the Energy Bull 3x ETF & ERY the Energy Bear 3x ETF. Will over 90% of that energy coming from fossil fuels, money spent on ERY is like investing in green energy. The Ukraine War has led to Russia's vast oil supply being omitted from the WTI calculation. That has led to hyper inflation in America and across the globe. A dozen eggs before the war cost less than $2 and now it cost over $4. I don't agree with that decision politically because all it's accomplished is making China the middle man. Russia's oil supply has essentially transitioned from legal market to underground market. American's buy the legal cost of over $100/bbl while China gets a discount from Russia. China then provides a discount to other nations purchasing energy from them. So those engaging in the underground market suffer less hyper-inflation from the war than the rest of the world. Be that as it may, now is the time for Americans to be buying ERY because the war will end soon enough. Russia's supply will be added back into WTI legally, and ERY will rise quickly. How exactly will that happen? Fund managers buy leveraged deratives on debt accrued by big energy/oil companies. The more retail investor cash pouring into ERY the more difficult it will become for these companies to manage their debt. That leads to pressure on profits. The less profitable big energy/oil becomes the more profitable green energy becomes. Eventually this see-saw effect drives down energy market share for big energy/oil & Pro Shares puts out leveraged green energy ETFs. Now Americans can easily invest in a greener energy America with less risk. I foresee the day Pro Shares offers 3x ETF's GRX (Bull) & GRY (Bear) for Green Energy. How important will that be? With regulator help, Americans would be able to look up GRX & discover the top 10 Green Energy companies. They would also see a hedge link for GRY. As GRX rises, GRY falls & becomes less inexpensive to buy as insurance against a fall in GRX. That's the essence of hedge trading & leverage ETF's remove the guess work on how to do it. The complexities of those investments are better left to the fund managers, but in essence the fund managers for GRY would purchase derivatives against the debt of the GRX companies. Areas of weakness in these companies would be targeted to produce gains in GRY. With regulator help, I forsee a near future where there is even less risk for Americans in these hedge investments. Fund Managers should not be overly concerned with making GRY a polar opposite of GRX. Instead GRX should be an investment in the 10 best performing green energy companies and GRY the 10 worst performing energy companies. The more those companies fail the higher GRY goes. In this way, Americans would see a slower fall in GRY as GRX rises making GRY investments less risky. In summary, regulators need to make leveraged ETF trading more accessible to American retail investors. 1) Everyone should be allowed easy access to purchases of fractional shares. Right now, Americans can invest against Big Oil with a purchase of ERY for about $5/sh. Allow them to purchase 1/10th of a share for as low as $0.50. That's a fractional cost of a lottery ticket. 2) Every stock should have a hedge link. When Americans look up ERY they would see the link for ERX. With hedge links on every page, Americans would quickly gain an understanding that investing in the market requires an understanding of purchasing insurance via hedge stocks and funds.