PSQ ETF

Wednesday's massive tech selloff points to near-term uncertainties surrounding AI investments.

Wall Street hesitated this week due to high inflation data, reducing the likelihood of a quick Fed rate cut. Additionally, tension in the Middle East has had a negative impact on stocks.

ProShares Short QQQ can be used to hedge your Big Tech gains and offset potential portfolio downside in a Wall Street bear market this year. The ETF's high cash investment yield, on a Treasury position beyond 100% of current market capitalization, is working in your favor. PSQ is often available to be traded in tax-free accounts, while direct short sales, more leveraged ETFs, and many option contract strategies are not.

While the buy-and-hold strategy makes the most intuitive sense, it's boring, which invariably leads curious investors down the path toward inverse ETFs. Just like any other exchange-traded fund, these bear trades represent a basket of securities under a single umbrella.

Buying the ProShares Short QQQ ETF provides a unique hedge against Big Tech stock losses, while offering a strong dividend yield. The product is a lower-risk way to profit from any decline in the NASDAQ 100 index. The daily rebalancing feature of this ETF limits net losses, while compounding gains to the upside, when interest rates are high like today.

Matthew Tuttle is currently not holding any positions overnight due to the uncertain market environment. Rob Isbitts highlights the importance of paying attention to market history and the potential for a market downturn.