Not really. The expense ratio difference is negligible, and VOO’s stability might be slightly better for covered calls in volatile markets. Focus on consistent strategy execution over tiny yield differences.
PapaCharlie9 on
“Long term holding,” as in 15+ years, is incompatible with a covered call strategy. Put another way, use covered calls on your VOO shares only if you want to underperform VOO shares without covered calls.
Covered calls guarantee you will sell your shares when they appreciate the most. There is no “safe” strike that pays a premium. The fact that the premium is non-zero is proof that there is some risk of assignment, otherwise the premium would be zero.
SnooBooks8807 on
IMO absolutely. That’s why I prefer SPY over every other S&P etf.
KingReoJoe on
VOO holders are almost all buy-and-hold long term investors. The option chain (or lack thereof) reflects this.
Buy SPY because you want to option trade the index. Buy VOO because you like the underlying long term.
4 Comments
Not really. The expense ratio difference is negligible, and VOO’s stability might be slightly better for covered calls in volatile markets. Focus on consistent strategy execution over tiny yield differences.
“Long term holding,” as in 15+ years, is incompatible with a covered call strategy. Put another way, use covered calls on your VOO shares only if you want to underperform VOO shares without covered calls.
Covered calls guarantee you will sell your shares when they appreciate the most. There is no “safe” strike that pays a premium. The fact that the premium is non-zero is proof that there is some risk of assignment, otherwise the premium would be zero.
IMO absolutely. That’s why I prefer SPY over every other S&P etf.
VOO holders are almost all buy-and-hold long term investors. The option chain (or lack thereof) reflects this.
Buy SPY because you want to option trade the index. Buy VOO because you like the underlying long term.