SCO is a 2x inverse leveraged ETF that seeks 200% of the daily performance of Bloomberg WTI Crude Oil futures — but in the opposite direction. When Bloomberg WTI Crude Oil futures falls 1% on the day, SCO aims to move about 2% up; when Bloomberg WTI Crude Oil futures rises 1%, SCO moves about 2% the other way. It is built for short, tactical holding periods, and like all daily-reset leveraged products it can lose value over time due to volatility decay, even if the underlying ends up where it started.
ProShares - UltraShort Bloomberg Crude Oil (SCO) is currently trading at $24.33. Over the past 52 weeks it has traded between a low of $22.84 and a high of $84.16, with recent daily volume around 2.7M. The wide 52-week range is typical of leveraged products and reflects how quickly they amplify moves in the underlying.
SCO uses swap agreements and futures to deliver 2x the inverse daily performance of Bloomberg WTI Crude Oil futures. Critically, it resets that leverage every single trading day, so returns over any period longer than one day will differ — sometimes dramatically — from 2 times the underlying's return. In a choppy, sideways market this daily reset causes 'volatility decay,' and SCO can bleed value even if Bloomberg WTI Crude Oil futures finishes flat over a few weeks. The same mechanics that make it a sharp day-trading tool make it a poor long-term hold.
SCO is a retail favorite among active day and swing traders who want concentrated, leveraged exposure to Bloomberg WTI Crude Oil futures without managing options or margin themselves. It suits short holding periods and clear directional setups. Buy-and-hold investors, retirement accounts, and anyone uncomfortable with rapid drawdowns should generally avoid it — it is engineered for days, not years.
Watch SCO around the catalysts that move Bloomberg WTI Crude Oil futures: sector earnings, economic and policy headlines, and technical breaks of key levels. Because it is inverse and leveraged, even an ordinary day in the underlying can produce an outsized move in SCO, and gaps at the open after overnight news are common.