Diamonds and Dogs
Micron (MU) led the chips higher after raising guidance following the departure of their CFO. The DRAM maker rose 11% after raising second quarter guidance to $2.70 -2.75 verse estimates of $2.56 a share. Revenue of $7.20-7.35 billion is also above guidance of $6.94 billion. Micron received two upgrades this morning with price targets of $76 and $85 a share.
The death of the inverse leveraged ETFs. The ProShares Short VIX Short-Term Futures ETF (SVXY) fell 82% and the VelocityShares Daily Inverse VIX Short Term ETN (XIV) fell 92% due to simple math. Conventional investments have theoretically unlimited upside potential, so that leaves inverse ETFs vulnerable to complete loss of value if the investment they track posts a daily gain approaching 100%. I doubt many investors understood that before buying these products.