Stock Market is the bottom in?

[hunts_with_stick]

IDK, doesnt seem too attractive to me. But I am not a financial advisor nor do I play one on TV.

 

[Double Creek]

NVII is looking very interesting to me for my Roth IRA. Anyone have opinions on this? I tried to research online, but there are so many ignorant douchebags on Reddit and other sites that I'm not sure about dropping a chunk of cash into something I don't fully understand. It's boasting a 4% monthly return and pays dividends weekly. That's over 40% per year on an ETF paying out cash on an options strategy.

Covered call strategies usually only outperform in a bear market. I'm not opposed to the strategy as I do think there is value in compounding income over time. Do your research though, a lot of the returns are coming out of the original capital investment, so it's not just pure income. Meaning, even with a 4% monthly payout, you could be down in the original position over time.

I have a couple covered call strategies in my IRA that have done ok, but have not outperformed the S&P over time. I have DIVO and JEPI. Divo has done much better as it's more of a hybrid strategy vs just a pure covered call. As always, if it sounds too good to be true, it probably is. If you are bullish NVDA, you would probably do better just buying the underlying or maybe even buying leaps. NVDA has been my top performer by far, but I've owned it since 2021. Not investment advice.

 

[Telemark]

Covered call strategies usually only outperform in a bear market. I'm not opposed to the strategy as I do think there is value in compounding income over time. Do your research though, a lot of the returns are coming out of the original capital investment, so it's not just pure income. Meaning, even with a 4% monthly payout, you could be down in the original position over time.

That's the problem. I can't figure out the graph. It doesn't seem to follow the market or the underlying asset. Is the ETF meant to be temporary?

 

[Badgers80]

I don’t think NVII is a covered call strategy…more so a leveraged ETF.
If you compare NVII and NVDA from end of May 2025 to August 2025, the trend is the same, strong up. But, because NVII is leveraged 105-150% of NVDA, when NVDA chops sideways, the ETF goes down. Say, NVDA goes up 10% one day, but then down 10% the next. The ETF will go up say 13% and then down 13%. Mathematically, you get 98.3% of your starting point. Vs NVDA gets you 99%. So, they both lose money vs your starting point but NVII loses more. That’s why you see NVII going down after that NVDA climb. So, yes, it’s supposed to be temporary and held in upward swings.

 

[Telemark]

If you compare NVII and NVDA from end of May 2025 to August 2025, the trend is the same, strong up. But, because NVII is leveraged 105-150% of NVDA, when NVDA chops sideways, the ETF goes down

That's what I don't get. It seems like they are managing it in a weird way. Like they are paying out too much and selling off shares to do it.

 

[Badgers80]

Best I understand it as they have to use options, swaps, etc. to get the ETF to emulate NVDA the way that they want it since they don’t actually just hold NVDA stock. In using those tools, they generate some cash from premiums which they can give out.

 

[Howboutthemdawgs]

Inflation running…shocking

 

[BuckSutherland]

^^^

We should print some more money. I have a great idea. Lets start another regime change war on the other side of the planet. That will help bring down the price of beef and health insurance in the United States.

 

[Howboutthemdawgs]

^^^

We should print some more money. I have a great idea. Lets start another regime change war on the other side of the planet. That will help bring down the price of beef and health insurance in the United States.

And tariff the whole world

 

[BuckSutherland]

^^^

Overnight China told all of their people to clear out of Iran. US Ambassador to Israel Mike Cuckabee told US citizens in Israel they need to leave today if they want to leave. Bombs will probably start falling this weekend. 30+ years of Iran being 1 week away from nuclear bombs is about to happen.

 

[Westwind]

This bunch really likes to do their bombing on the weekend.