Why Nasdaq-100 Inverse ETF SQQQ Is Moving

ProShares UltraPro Short QQQ ETF SQQQ shares are trading higher by 1.1% to $21.34 during Wednesday's session. The ETF is trading marginally higher as Treasury yields rise Wednesday. Rising oil prices are also weighing on the broader market.

SQQQ is primarily designed for short-term trading and market timing strategies. Some investors may use it as a tool to take advantage of anticipated market downturns or as a tactical way to implement short-term trading strategies based on their outlook for the NASDAQ-100 Index.

Why It Matters

SQQQ's strategy is particularly relevant when applied to the technology sector. The NASDAQ-100 Index is heavily weighted toward technology and growth-oriented stocks. When interest rates rise, it can lead to higher discount rates applied to future cash flows, potentially reducing the present value of future earnings for tech companies.

This can lead to a decline in the stock prices of tech-related firms, which can benefit SQQQ.

See Also: U.S. Stocks Struggle As Fed Sounds Hawkish

According to data from Benzinga Pro, SQQQ has a 52-week high of $69.55 and a 52-week low of $16.38.