covered calls for passive income

[Anonymous No.52499339]

>have an online business that makes $5k a month
>have to work 30hrs/wk to keep it running
>could sell that business for $250k on Empire Flippers
>invest that $250k in USCC (a covered call ETF on the Toronto Stock Exchange) and earn ~$3k/month passively
would you do this?
is there a flaw in this plan?

[Anonymous No.52501020]

>>52499339
Buying ETFs?
In this market?
Buy 1x leverage puts instead

[Anonymous No.52501607]

>>52499339
1.2% seems aggressive, you will get exercised

[Anonymous No.52501625]

>>52499339
Going from one strategy to all-in on another for less overall income sounds risky, although freeing up your 30hrs/week might be worth it to you. I'm risk averse so I would build up to $2k/mo. passively while still operating the business, since it won't add to your workload but WILL add to your income. Once the CC income following the sale and buying of shares exceeds your current day business income, I would definitely sell.

[Anonymous No.52502859]

you WILL be exercised

have a good one

[Anonymous No.52502901]

>>52499339
No one is going to buy your 5k a month business.

[Anonymous No.52502916]

pick zwc instead, safer and if you're on tsx yo should exposed to canadian assets anyway
>>52502859
doesn't matter in an etf they buy back if they get exercised

[Anonymous No.52503323]

>>52499339
Anon you are going to get reamed. The main problem with covered call ETFs is how they are maintained. Now I'm not familiar with your ticker but in America a lot of covered call ETFs continuously write calls no matter what the market is doing, in a normal covered call, the market can go up and you are assigned you make money up to the strike you sold or the market goes down and you have some protection from the premium you collected by writing the short call, however if the underlying/market tanks you have to write calls ABOVE the original strike price that you bought your shares, if you don't you will lock in a loss should the market go above a written call at a strike below your original purchase price-premium. Many covered call ETS don't account for this and sell calls willy-nilly thereby almost guaranteeing a permanent loss when the market recovers.
As a example.
>Bought shares at $125
>Sold OTM call at $130 collected $4 a share in premium.
>Share price drops to $110
>At this point you would be losing $11 a share (15 drop -4 premium gains).

If you write a call at 110 if you are assigned you will have a permanent loss you could always sell above your original purchase price minus premium that being 121$ but doing so may result in less premium.