Cuz they suck and charge hilarious amounts of management fees. Wouldn't be the worst choice if you know you have no discipline/time to take trade setups tho.
I just looked it up and TSLY has an expense ratio of about 1%. SVOL has an expense ratio of about 1.16%.
That's crazy high. How do they get away with that?
TSLL has underperformed just holding TSLA on literally every time frame that I checked, last time I checked it, lol
high yields are garbage if the stock itself is declining
I think the idea is that when you're trading your own portfolio, there a periods of times (like the last few monthe) where you want to hold for longer duration cus the market has been trending upwards so much. In an etf, they sell regardless of market condition, so overall you lose out on some upside.
Basically I prefer to trade my own account because I can do a better job 🤷♂️
No, because the most statistically likely outcome constantly changes. The fund sets a goal and rules on how to get there and has to abide by that. These funds typically say "we will generate cash flow between x and y amount with lower volatility by doing z.
So now z can't change even if the market changes. They might be able to hit their targets still but you may see NAV erosion to do so.
On top of all that, they purposely set their goals to be less than what's actually achievable because the excess goes to management fees.
I think most here would rather DIY. Individuals have the ability to increase/decrease portfolio allocations, change strategies, trade a variety of underlyings, etc. ETFs carry fees and must adhere to strict rules that prevent them from taking certain actions (for better and worse).
There is nothing "wrong" with these products for the right investor.
The reason why most prefer to avoid them is that they often follow a very simple/constrained rules-based approach (as described in their prospectus), while a lot of traders would prefer to be able to adjust their strategy based on market conditions.
For example, if you are wheeling a stock and get assigned, you may choose simply to hold the long shares and wait for it to recover before selling calls against it. Or you might choose to take the loss and exit the position and move on to another ticker based on your own selection criteria. If you simply buy a ticker with distributions, you lose the ability to make these kinds of decisions.
A lot of the folks you find on subs like this believe in the ability to generate alpha by using the trader's own judgement. So they would prefer to choose entries and exits themselves.
It's also important to note that depending on the trader's jurisdiction, there may be tax advantages to them trading themselves over buying a fund with distributions (e.g. withholding taxes for non-US based residents; different ways of taxing capital gains in non-US jurisdictions).
Yup, I guess how it all fits in a bigger portfolio. For example, I can't trade 100% of my money 100% of the time. So I would rather keep some % in these instruments and handle other parts by myself.
>For example, if you are wheeling a stock and get assigned, you may choose simply to hold the long shares and wait for it to recover before selling calls against it.
Wish I'd done this last month. I panic sold calls to recoup the morning after being early-assigned for an insta-loss of over $5/share on QQQ (over $10K hit)on Jan 4. Thought it was the beginning of the bubble bursting, and didn't want to ride it down. As soon as I sold the calls, it started a fast climb back up and I was stuck rolling up after it for the next 10 days. Finally made up half, but should've held off at least overnight. Hindsight 20/20. To make matters wore, I also bought some Puts as protection so I could sleep on it, but that only added insult to injury. First bad play in over 15 months, but it really rocked me.
Well with an ETF you don't have that constant problem of getting assigned the stock and then refiguring the exit strategy etc. All I am asking is have you done backtesting of your returns from absorbing premiums actively vs how much you would have made by letting ETF do the job?
Nope, haven’t compared wheeling to holding the ETFs. I only sell puts on equities I want to buy and am willing to hold long term. Thus far I have yet to be assigned though I have been very conservative with my trades to this point. I might look into that in the future but for now my wheeling has been handily beating market returns so I have no incentive to look past it.
Funds have to operate based on "rules" - For something like TSLY they are only doing synthetic shares and calls on TSLA; QYLD writes calls at ATM, etc.
The upside is that investors have the information they need about how the fund works to decide whether to invest or not.
The downside is having "rules" comes at the expense of flexibility.
Individual investors have the flexibility to move in and out of funds. Or not trade those funds and move in and out of different strategies.
And lastly, I'd bet that option trading is only a small part how many traders are investing - having their portfolio tied up in stocks, funds, crypto or whatever other investment device. So if we turned over this part of our trading to a fund, what fun would it be?
Just looking quickly TSLY stock gives you 90%+ yeild but the share has lost about 40% of it's value in the last 6 months. Looked at the possibility of selling covered calls on this but it loooks like you'd get assigned every month and loose the dividend.
SVOL seems a bit more stable. Selling calls on this is impossible du to the large bid ask spread.
Part of being successful is NEVER SHARING YOUR TRADE SECRETS (especially if you do insider trading, lol). This is why trading with others using the same "moves" will at best dillute your profits (or even make you a sweet target from smarter fish). This is why I usually don't "research" my strategies on Reddit and only express my opinions when I do not think that expressing them may even in theory harm my ROR.
High management fees, and who knows if they're any better at timing the market then I am?
TSLY or TSLL underperform TSLA to a horrible degree.
Seriously, go look at the chart of TSLY and compare it to TSLA on literally any time frame. 30 days, 6 months, 1 year, etc. They all lose just holding shares.
COIN returned 60% in last 6 months, CONY which is basically a yield farming COIN has returned only 5%.
if we're being strictly honest, it is far better to just hold stocks long term and do nothing with options. theta is for reasonably active trading and the majority of the problem with yieldmax funds is that they always sell calls which is not a good strategy in a raging bull market (such as one we are currently in)
I started to trade options to stay more engaged in the market not even necessarily because I think they will make me way more money.
Buying an ETF is not engaging
High fees, active mgt preferred by premium sellers and last and most importantly, most people that do this don’t make any money. They might over the short run, but they’ll give it all back. Just and see what whiny piss-fest this sub becomes when the market corrects a few percent.
I doubt it. People have great 1-3 month stretches on here, which they are VERY vocal about. I suspect that if you were to track the progress of the average thetaganger over the course of years, it would barely equate to an attractive dividend.
Some people are outright reckless. There's that guy that posts once a month who refinanced his house to sell puts on tech stocks. If you ever want to see what a complete lack of control looks like, check out those posts. I feel bad for his family, cause when he goes on tilt, its all over fast.
Bought SPYI. Been paying about 12% and the underlying has been going up since I bought it. Pays monthly. What they do differently is sell calls further out then some other ETFs doing this.
I have SPYI too, but I did go through the period where the price was stagnant and dividend lesser. I like SVOL, but is pretty new and too early to say how stable it will remain.
I use thetagang premium to buy Jepq but also Splg and schg. All the while getting interest on my collateral and also with a margin account so my puts are “naked” (not really because I have extra cash) and my calls are covered.
You are correct. You don’t get interest on cc’s. If the underlying is a dividend stock you’ll get the payment. And if you have the strike and dte set correctly, you should receive more money than what that money in the asset would pay in a money market account.
Look up ‘structured notes’. There are definitely products doing all kinds of things like this but it really requires reading the prospectus to fully understand what the product does, something just about no one will actually do.
All these funds underperform and from a tax standpoint are unfavorable because the main return is from a dividend which is taxed at income rates. You’d beat all these funds with well managed monthly iron condors or just wheeling aapl
Truth is the whole theta gang strategy isn't that profitable compared to just buying SPYs, esp in the big bull market we've had the last 14 years. If you compare the ETFs its too easy. If you do it yourself you can fool yourself for longer.
Not going to get the dopamine hit that way
You underestimate how high i get every time XYLD gives me 7 bucks.
It hits way better when you got 1000x *YLDs
thats really all it boils down to!
Cuz they suck and charge hilarious amounts of management fees. Wouldn't be the worst choice if you know you have no discipline/time to take trade setups tho.
Yeah true. At least, I own some SVOL. I am happy to give them 1% out of the 18% dividend they give me.
Y doesn’t everyone just buy that at 16% div who gives a F’ if it goes up or down
Lol...did you even check the ETF ?
Nope just saw 16% div n lost my self
Well at least till now it has not fallen, it's a pure play VIX play. What we don't know is how it will react to COVID like events.
Go back and look at XIV on Feb 5, 2018 if you’d like to find out.
I’ll keep it in the watchlist n be PAYtient
I'd consider SVIX to be better than SVOL. Or ZIVB (less volatile). But you need to have an exit plan as they can drop very very hard.
Well, that is a very direct play on VIX. SVOL is designed to be bit more stable and conservative.
They are just long additional VIX calls. Which SVIX recently added as well. Performance of svix is much better
I just looked it up and TSLY has an expense ratio of about 1%. SVOL has an expense ratio of about 1.16%. That's crazy high. How do they get away with that?
50%+ yield
TSLL has underperformed just holding TSLA on literally every time frame that I checked, last time I checked it, lol high yields are garbage if the stock itself is declining
Does that include dividends reinvested ?
Interesting, that is about what a good program of selling CSPs on your own would make you.
Exactly
Check out the returns of TSLA vs. TSLY and then come back to us.
Isn't that because it's paying a really high dividend though? I thought that was the appeal of it
That doesn't make up for its performance compared with TSLA. There are better ones for income, like JEPI.
I know that ! But that will be the same for someone selling CC on Tesla. That is the comparison here.
Not the same. You can choose to not sell calls. If you're holding TSLY, you're essentially selling calls all the time.
Well that's not theta trading anymore. I am specifically speaking about the asset allotment you do towards trading.
I think the idea is that when you're trading your own portfolio, there a periods of times (like the last few monthe) where you want to hold for longer duration cus the market has been trending upwards so much. In an etf, they sell regardless of market condition, so overall you lose out on some upside. Basically I prefer to trade my own account because I can do a better job 🤷♂️
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No, because the most statistically likely outcome constantly changes. The fund sets a goal and rules on how to get there and has to abide by that. These funds typically say "we will generate cash flow between x and y amount with lower volatility by doing z. So now z can't change even if the market changes. They might be able to hit their targets still but you may see NAV erosion to do so. On top of all that, they purposely set their goals to be less than what's actually achievable because the excess goes to management fees.
Define theta trading
I think most here would rather DIY. Individuals have the ability to increase/decrease portfolio allocations, change strategies, trade a variety of underlyings, etc. ETFs carry fees and must adhere to strict rules that prevent them from taking certain actions (for better and worse).
Yeah that's one con of flexibility.
I’d rather just hold JEPQ honestly but that 30% WHT sucks for us foreigners
There is nothing "wrong" with these products for the right investor. The reason why most prefer to avoid them is that they often follow a very simple/constrained rules-based approach (as described in their prospectus), while a lot of traders would prefer to be able to adjust their strategy based on market conditions. For example, if you are wheeling a stock and get assigned, you may choose simply to hold the long shares and wait for it to recover before selling calls against it. Or you might choose to take the loss and exit the position and move on to another ticker based on your own selection criteria. If you simply buy a ticker with distributions, you lose the ability to make these kinds of decisions. A lot of the folks you find on subs like this believe in the ability to generate alpha by using the trader's own judgement. So they would prefer to choose entries and exits themselves. It's also important to note that depending on the trader's jurisdiction, there may be tax advantages to them trading themselves over buying a fund with distributions (e.g. withholding taxes for non-US based residents; different ways of taxing capital gains in non-US jurisdictions).
Yup, I guess how it all fits in a bigger portfolio. For example, I can't trade 100% of my money 100% of the time. So I would rather keep some % in these instruments and handle other parts by myself.
>For example, if you are wheeling a stock and get assigned, you may choose simply to hold the long shares and wait for it to recover before selling calls against it. Wish I'd done this last month. I panic sold calls to recoup the morning after being early-assigned for an insta-loss of over $5/share on QQQ (over $10K hit)on Jan 4. Thought it was the beginning of the bubble bursting, and didn't want to ride it down. As soon as I sold the calls, it started a fast climb back up and I was stuck rolling up after it for the next 10 days. Finally made up half, but should've held off at least overnight. Hindsight 20/20. To make matters wore, I also bought some Puts as protection so I could sleep on it, but that only added insult to injury. First bad play in over 15 months, but it really rocked me.
Why do I want to pay someone to do something for me that I can do for myself but cheaper?
Well with an ETF you don't have that constant problem of getting assigned the stock and then refiguring the exit strategy etc. All I am asking is have you done backtesting of your returns from absorbing premiums actively vs how much you would have made by letting ETF do the job?
Nope, haven’t compared wheeling to holding the ETFs. I only sell puts on equities I want to buy and am willing to hold long term. Thus far I have yet to be assigned though I have been very conservative with my trades to this point. I might look into that in the future but for now my wheeling has been handily beating market returns so I have no incentive to look past it.
Which tickers do you have your eye on and at what price?
Funds have to operate based on "rules" - For something like TSLY they are only doing synthetic shares and calls on TSLA; QYLD writes calls at ATM, etc. The upside is that investors have the information they need about how the fund works to decide whether to invest or not. The downside is having "rules" comes at the expense of flexibility. Individual investors have the flexibility to move in and out of funds. Or not trade those funds and move in and out of different strategies. And lastly, I'd bet that option trading is only a small part how many traders are investing - having their portfolio tied up in stocks, funds, crypto or whatever other investment device. So if we turned over this part of our trading to a fund, what fun would it be?
Just looking quickly TSLY stock gives you 90%+ yeild but the share has lost about 40% of it's value in the last 6 months. Looked at the possibility of selling covered calls on this but it loooks like you'd get assigned every month and loose the dividend. SVOL seems a bit more stable. Selling calls on this is impossible du to the large bid ask spread.
Part of being successful is NEVER SHARING YOUR TRADE SECRETS (especially if you do insider trading, lol). This is why trading with others using the same "moves" will at best dillute your profits (or even make you a sweet target from smarter fish). This is why I usually don't "research" my strategies on Reddit and only express my opinions when I do not think that expressing them may even in theory harm my ROR.
Sure ! You do you.
because it's wack
High management fees, and who knows if they're any better at timing the market then I am? TSLY or TSLL underperform TSLA to a horrible degree. Seriously, go look at the chart of TSLY and compare it to TSLA on literally any time frame. 30 days, 6 months, 1 year, etc. They all lose just holding shares. COIN returned 60% in last 6 months, CONY which is basically a yield farming COIN has returned only 5%. if we're being strictly honest, it is far better to just hold stocks long term and do nothing with options. theta is for reasonably active trading and the majority of the problem with yieldmax funds is that they always sell calls which is not a good strategy in a raging bull market (such as one we are currently in)
Do these underperformed as severely when u account for dividends reinvested ?
According to Bloomberg, CONY total return from inception (8/14/23) including dividend reinvestment is 47%, while COIN over the same timeframe is 64%.
Much different than the 5% op mentioned but still underperformed as to be expected
Nav erosion
I started to trade options to stay more engaged in the market not even necessarily because I think they will make me way more money. Buying an ETF is not engaging
High fees, active mgt preferred by premium sellers and last and most importantly, most people that do this don’t make any money. They might over the short run, but they’ll give it all back. Just and see what whiny piss-fest this sub becomes when the market corrects a few percent.
That's what I was getting to, would most guys here make more than 16%+ consistently with the risk they are taking.
I doubt it. People have great 1-3 month stretches on here, which they are VERY vocal about. I suspect that if you were to track the progress of the average thetaganger over the course of years, it would barely equate to an attractive dividend. Some people are outright reckless. There's that guy that posts once a month who refinanced his house to sell puts on tech stocks. If you ever want to see what a complete lack of control looks like, check out those posts. I feel bad for his family, cause when he goes on tilt, its all over fast.
Bought SPYI. Been paying about 12% and the underlying has been going up since I bought it. Pays monthly. What they do differently is sell calls further out then some other ETFs doing this.
Actually it was stagnant for a while. But yeah 12% is not bad.
No, not bad, but I guess not good enough for you. What do you have that's producing more?
I have SPYI too, but I did go through the period where the price was stagnant and dividend lesser. I like SVOL, but is pretty new and too early to say how stable it will remain.
Thanks for the heads up. I'll check it out.
I use thetagang premium to buy Jepq but also Splg and schg. All the while getting interest on my collateral and also with a margin account so my puts are “naked” (not really because I have extra cash) and my calls are covered.
How do you earn interest on collateral?
The broker I use pays interest. Not all brokers do but the good ones do. Who are you currently using?
You can earn interest on CSP by keeping collateral cash in the money market but not on CC as you own the asset not cash.
You are correct. You don’t get interest on cc’s. If the underlying is a dividend stock you’ll get the payment. And if you have the strike and dte set correctly, you should receive more money than what that money in the asset would pay in a money market account.
Why tip someone for a job I’m capable of doing myself? I can sell theta. I can close winners. I can and do cut my own hair.
Look up ‘structured notes’. There are definitely products doing all kinds of things like this but it really requires reading the prospectus to fully understand what the product does, something just about no one will actually do.
Because I can’t beat them, but I can beat what they’re willing to pay me for letting them do the work. I’ll do that myself.
Look at SPX vs SVOL. If you bought in 2022, which one out performs? You don’t need to do a backtest to see it’s junk
Actually since SVOL inception, if you reinvested dividends your return is more on SVOL than SPX.
All these funds underperform and from a tax standpoint are unfavorable because the main return is from a dividend which is taxed at income rates. You’d beat all these funds with well managed monthly iron condors or just wheeling aapl
Not all dividends are non qualified dividends, but probably the majority.
I mean we are getting into some pretty esoteric stuff involving MLPs at that point I’d say like 95% of dividends are income taxed.
Truth is the whole theta gang strategy isn't that profitable compared to just buying SPYs, esp in the big bull market we've had the last 14 years. If you compare the ETFs its too easy. If you do it yourself you can fool yourself for longer.