3 Stocks to Short in Early 2026, and 3 ETFs That Make Betting Against Them Even Easier

I have a confession to make. I’ve never shorted a stock or ETF in my life. That’s right, the guy who ran a few “long-short” mutual funds has never shorted anything. Or have I?

You see, shorting involves borrowing shares, and taking the risk that the stock or ETF could move against you. Infinitely. There’s no limit to how much you can lose. Whereas with buying a put option, if you are the buyer, you can only lose the capital you put up.

I’ve always been very comfortable with that tradeoff: unlimited upside, limited downside. It even feels good to type it here!

I’ve used put options a lot over the decades, but I’ve also used many, many inverse ETFs. Those are the ones structured so that on a daily basis, whatever the stock or ETF or index does, the inverse ETF moves in the opposite direction.

Or, in the case of leveraged inverse ETFs (a mouthful, I know), it could be 2-3 times as volatile, both ways. In fact, the more I use leveraged ETFs long and inverse, the more I look to them as an option replacement or at least a surrogate.

Leveraged long ETFs sub into the game for call options, and leveraged inverse ETFs for put options. The next time market volatility kicks way up, that approach will be the only game in town for a while. Because trying to buy options with a Cboe Volatility Index ($VIX) at 25, 30, or higher gets prohibitively expensive.

While inverse ETFs on major indexes have been around for nearly 20 years, I’d like to introduce (or re-introduce) a more contemporary version of “shorting without shorting.” It is a new crop of ETFs that essentially aim to provide short-like exposure to individual stocks. In other words, what investors like me have looked forward to for a long time. And a short time!

The list keeps growing, but I’ll highlight three of them here, since they hit my radar as “interesting stocks to bet against, but they also have inverse ETFs available, either in -1X or -2X format.” Remember, there’s a learning curve here, so be very careful before you plunge into these with more than a token amount of capital.

One question I get frequently on these ETFs is whether to look at the chart of that inverse security, the underlying stock, or both. My response: Definitely the stock first, since the only way the inverse ETF doesn’t move opposite and to the same degree on a daily basis is if the ETF is flawed in its construction. And I don’t see that much, if at all.