ETFs that sell options for yield

[Jdesey]

OK I guess that’s the latest and greatest thing. ETFs that sell 0DTE options to generate income. QQQY just declared a one $1.10 monthly dividend on what is about a $16 investment. And yes that is a whopping 65% annual dividend. I checked it out and what they are doing is selling 0DTE options on SPY. Got to imagine that this is all fine and dandy until it totally blows up? People are posting videos on YouTube that says “retire on $50,000” and then telling about this ETF.


https://finance.yahoo.com/news/defiance-etfs-announces-monthly-distributions-002000758.html

 

[qwerty11]

So it sounds like your actual question is if you can get rich quickly with this...

 

[traider]

Free money?

 

[qwerty11]

Yes, it's just not discovered yet by the large hedge funds and institutional investors. If they step in the market will be saturated with options thereby crumbling the current huge yield.

 

[cesfx]

Sure they keep that monthly?
It has options

 

[qwerty11]

But this is one of the worst assets to play with options (IV almost 0 and no divvy)...

 

[engineering]

Interesting to read about but my guy tells me "Anything Involving QQQ will eventually rip your face off"

 

[athlonmank8]

OK I guess that’s the latest and greatest thing. ETFs that sell 0DTE options to generate income. QQQY just declared a one $1.10 monthly dividend on what is about a $16 investment. And yes that is a whopping 65% annual dividend. I checked it out and what they are doing is selling 0DTE options on SPY. Got to imagine that this is all fine and dandy until it totally blows up? People are posting videos on YouTube that says “retire on $50,000” and then telling about this ETF.


https://finance.yahoo.com/news/defiance-etfs-announces-monthly-distributions-002000758.html

Good info. Statistically this *should* have substantial risk correct? Competition or the strategy is flawed.....etc