ProShares UltraShort SmallCap600

ProShares UltraShort SmallCap600 (SDD) uses swap contracts with banks to seek twice the opposite (-2x) of the S&P SmallCap 600 Index's return each day, so it gains on days small-company stocks fall. Built for short-term bets against small caps, it resets daily, so results over longer periods can stray far from -2x: it lost 95% over the 10 years through October 27, 2026. Net assets were just $1.4 million as of August 31, 2026.

• Over the year to Oct 27, 2026, SDD returned -25.0%, 4th of 6 among similar funds.
• Its 5-year annualized return was -15.1% and its 10-year -26.4%.
• In the 2020 COVID crash, while stocks fell, it gained 127.2%.
• Its worst full calendar year was 2009 (-57.1%); its best was 2008 (+35.2%).
• The deepest fall in its price history was 99.9% (Mar 9, 2009 to Aug 4, 2026), not yet recovered.

As of Aug 31, 2026, most of the fund sat in cash, Treasury bills and money-market holdings (0% of net assets), with its inverse exposure coming from 3 swap and futures positions rather than from owning the stocks outright.

• Over the three months to Aug 31, 2026, investors added a net $84K (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: -13.06%, +4.46%, +1.58%.

SDD's benchmark is the S&P SmallCap 600 Index from S&P Dow Jones Indices. It includes 600 small U.S. companies, selected and weighted by market value (share price times shares outstanding). As of May 31, 2026, members ranged from $200.2 million to $14.2 billion. The lineup is reviewed each September, with weight adjustments in March, June and December. The prospectus flags large weights in financial and industrial companies.

SDD does not hold the index's stocks. ProShare Advisors uses a mathematical approach to choose a mix of swaps, contracts with major banks that pay the fund when the index falls and cost it when the index rises, plus cash-like holdings such as Treasury bills. As of August 31, 2026, repurchase agreements (short-term loans usually backed by U.S. government securities) made up about 64% of reported holdings, alongside three total return swaps.

The fund resets its exposure every day. If the index rises, the fund's assets shrink and it reduces exposure; if the index falls, it adds exposure. Because of this reset, returns over weeks or years can differ sharply from -2x the index, usually for the worse when markets swing back and forth. If the index nears a 50% gain within a day, holders could lose everything. Swaps also add counterparty risk: losses if a bank fails to pay.

• SDD charges 0.95% a year, versus an average of 0.95% for the similar funds below (1st of 3, cheapest first).
• Of that, 0.75% is the management fee; the rest covers other fund expenses.
• The fee includes a 4.57% waiver from the adviser, which may end.
• Using the prospectus's standard example, $10,000 invested would cost about $97 in the first year and $5,147 over 10 years (assuming a 5% annual return).

Its -2x inverse exposure resets daily, and it lost 95% over the 10 years through October 27, 2026.

SDD rose in past crashes: 222.9% from the October 2007 market peak to the March 2009 low, 127.2% in the 2020 COVID crash and 43.5% in the 2022 bear market. Even those runs had sharp setbacks, such as a 31.3% drop from June to August 2022. Its worst calendar year was 2009, down 57.1%. Its deepest decline, 99.9% from March 2009 to August 2026, has not recovered. Crash gains have faded fast, so anyone drawing money in a bad year would depend on precise timing.

Its yield over the 12 months to October 27, 2026, was 4.74%, paid quarterly, but that was small next to its 25% one-year loss. The expense ratio (yearly costs as a share of assets) is 0.95% after a 4.57% fee waiver. Past results don't predict future ones, and a plan should look at the whole portfolio, not one fund.

Matched by leveraged/inverse funds on the same index (russell 2000), same direction.