What Is UCO? ProShares Ultra Bloomberg Crude Oil

UCO is the ProShares Ultra Bloomberg Crude Oil ETF, a leveraged fund that seeks daily results, before fees and expenses, equal to 2x (200%) the daily performance of the Bloomberg Commodity Balanced WTI Crude Oil Index. It uses a mix of futures contracts and swaps to build that amplified exposure, backed by cash and Treasuries as collateral.

It is issued by ProShares and structured as a commodity pool, so investors receive a Schedule K-1 at tax time. With a net expense ratio near 0.95% and daily-reset leverage, UCO is built for traders taking a short-term bullish position on crude oil, not for investors seeking long-term oil exposure.

Approximate weights as of mid-2026; refresh quarterly from ProShares's fund page. Each ticker links to its individual stock guide in Walnut.

UCO does not hold physical oil or ordinary stocks. Its exposure comes from WTI crude oil futures and swap agreements referencing the Bloomberg Commodity Balanced WTI Crude Oil Index, held at roughly 200% notional, with the remainder in cash and short-term Treasuries used as collateral.

The balanced index behind UCO spreads its WTI futures across several contract months rather than concentrating in the front month. That design is meant to reduce the roll costs that hurt front-month-only oil funds, though it does not remove the drag from contango entirely.

USO offers roughly 1x daily exposure to WTI crude, making it the more moderate choice, while UCO doubles the daily move in both directions. SCO is UCO's inverse, seeking 2x the opposite of oil's daily change for traders betting on falling prices.

The right pick depends entirely on your view and time horizon. UCO magnifies a bullish oil bet but decays faster, USO is a steadier tactical oil tracker, and SCO is the bearish counterpart. All three are trading instruments rather than long-term core positions, and the leveraged pair carry the greatest decay risk.

UCO's leverage is reset every single day, which means its 2x objective applies only to one day at a time. Over multiple days, returns compound, so the fund's performance can differ sharply from simply doubling oil's move over that stretch. In a volatile but directionless market, this compounding steadily erodes value, a phenomenon known as volatility decay.

On top of the daily reset, UCO carries futures roll risk. When the WTI curve is in contango, rolling expiring contracts into pricier later ones creates a persistent drag. The combination of leverage decay and roll costs is why ProShares itself describes these funds as intended for short holding periods and daily monitoring.

UCO fits active traders who want to express a strong, short-term bullish view on crude oil and who accept that the fund amplifies losses as readily as gains. It is not designed as a long-term holding, and volatility decay plus roll costs make multi-week holds risky even when the directional call is right.

Because it pays no income, costs about 0.95% a year, and issues a K-1, it plays a very different role from a broad equity or bond fund. Whether leveraged oil exposure suits you depends on your goals, risk tolerance, and horizon. Walnut is not an investment adviser and this is not a recommendation.

UCO trades on NYSE Arca under the ticker UCO and is available through most US brokers, including Robinhood, Fidelity, Schwab, and Public, frequently in fractional shares. Given its leverage, many traders use limit orders and monitor positions closely rather than holding passively.

If you hold or plan to trade UCO, you can connect your brokerage to Walnut to see the position in the context of your overall portfolio and thesis. Walnut mirrors your holdings read-only and never places trades on its own.

UCO delivers 2x the daily move of a WTI crude oil futures index, magnifying both gains and losses. Because it rebalances daily, volatility decay and futures roll costs make it unsuitable for buy-and-hold, and it is used for short-term bullish oil bets. Walnut is not an investment adviser and this is not a recommendation.

Whether UCO is worth buying today depends more on your time horizon and what you already hold than on any single call. We walk through valuation, concentration, and what would have to be true for it to outperform from here in is UCO a buy?

UCO yields 0% as of mid-2026, paid by passing through the dividends of its underlying holdings. For the payout schedule, history, and how the distributions are taxed, see UCO dividend: yield and schedule.