The ProFunds Rising Rates Opportunity Fund Down Over 30% In 2014
The ProFunds Rising Rates Opportunity Fund, which trades under the ticker symbols RRPSX and RRPIX, is a non-diversified fund that seeks to match 125% of the inverse daily performance of the 30-Year U.S. Treasury Bond. In other words, the fund attempts to move one and a quarter times as much as the bond index, but in the opposite direction. The fund seeks to invest its assets in derivatives, options, and swaps.
The fund has consistently had very poor performance. In 2014, the Service-class shares, RRPSX, were down 30.81% for the year, and the 5-year average annual return is negative 17.64%. In addition to poor performance, the fund has high fees (over 2.5%) and annual turnover of almost 1300%.
As of October 31, 2014, the fund, managed by Michelle Liu, was invested primarily in cash and swaps, which are usually illiquid and extremely difficult to value.
If your financial advisor or stockbroker recommended that you invest in the ProFunds Rising Rates Opportunity Fund, you may have options to recover your investment loss. If your advisor failed to fully disclose the risks of investing in the ProFunds Rising Rates Opportunity Fund, then you may have a claim for misrepresentation. If your investment objective was to only invest in safe and stable investments, you may have a claim for unsuitability. If the ProFunds Rising Rates Opportunity Fund made up a large portion of your portfolio, then you may have a claim for over-concentration and lack of diversification. If your advisor purchased this fund without your knowledge, you may have a claim for unauthorized trading. If your advisor purchased this fund on margin, you may have a claim for excessive use of margin and negligence.
The attorneys at Carlson & Associates, P.A., located in Miami, Florida, represent investors who have lost money due to the improper conduct of financial advisors. If you would like to have a free consultation, we can be reached at (305) 372-9700 to discuss your options.