Volatility Drag
The mathematical decay that affects leveraged and inverse ETFs (and any compounded multi-period leveraged exposure) when the underlying chops back and forth rather than trending. Mechanism: a 10% gain followed by a 10% loss leaves you down 1% on an unlevered position but down 9% on a 3x daily-reset position, because the quadratic term in the compound-return formula scales with the SQUARE of the leverage factor. Also called compounding decay or beta slippage. The drag is why daily-reset leveraged products lose money during sideways volatile markets even when the underlying ends flat.
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American Option · Asian Option · Barrier Option · Basket Option · Butterfly Spread · Calendar Spread
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