re: Options Trading Thread

@ Jag or anybody else.

I have a question on the down side to this trade.

Ticker is SQQQ.
- Pays a 9% divi
- it's at a low because the market is up. It goes higher as the market drops.
- Total cost per share, $10.50

SQQQ provides (-3x) inverse exposure to a modified market-cap-weighted index of 100 of the largest non-financial firms listed on the NASDAQ.
Index-Tracked: NASDAQ 100 TR USD

My reasoning for this purchase:

- If the market drops, this goes up offsetting some loses.
- Buy low, sell high right.
- I collect the divi
- I can sell calls on it weekly. I will not make but $5-15 on that.
- The market would have to scream in order for this to have any real loss.


OR

- Purchase a PMCC for 2 years out.
- The $7 strike is $4.75
- Purchase 2
- Sell calls on it.

I lean towards the first option due to the divi. It pays out $1.04 per year on a semi annual basis.


I'm looking for push back against this investment. What am I missing with this?