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Leveraged ETPs suffer from path dependency and volatility decay, making them mathematically unsuitable for long-term holdings in sideways markets.

Impact: Portfolio managers must restrict leveraged instruments to short-duration, trend-following allocations with strict risk controls to prevent capital erosion.

— from German Reforms, Leveraged ETPs, and AI Analytics · Deffner und Zschäpitz – Der Wirtschafts-Talk von WELT· Jul 21, 2026