5 ETF Plays for a Volatile Bear Market

• Flows into exchange-traded funds that hedge the market are surging as volatility is starting to pick up.
• AdvisorShares’ CEO explains the strategy behind 2 short ETFs that returned over 20% in the 2018 and 2020 market crashes.
• And he shares 3 other ways to use ETFs to play a more erratic market environment.

After a year of flows mostly leaving AdvisorShares’ hedging exchange-traded funds while the

bull market
raged on, the tide is turning.  

In the last three months, $4.5 million has flowed into AdvisorShares’ $29 million Dorsey Wright Short (DWSH) ETF, according to etfdb.com. Over the last 12 months, the fund has seen outflows of $37.5 million.

For the same period, $15 million has flowed into their $71 million Ranger Equity Bear (HDGE) ETF, although the fund is still showing a net outflow $20 million over a 12-month period, according to etfdb.com. 

This isn’t surprising, as the bullishness that has buoyed markets this year has started to lose some luster.

In recent weeks, markets have grappled with a range of issues, from surging inflation to China’s second largest property developer Evergrande facing default, to an energy crisis sweeping through Europe and Asia and a battle over the raising of the US government debt ceiling.

The combination of events caused September to be the worst month for stocks this year. The NASDAQ fell 5% for its worst…