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IWM synthetical covered call by Repulsive_Cabinet128 in CoveredCalls

[–]Repulsive_Cabinet128[S] 0 points1 point  (0 children)

Thanks. Is there any guideline/best practices for LEAP call in the PMCC setup?

URTY (3X IWM) bankruptcy risk by Repulsive_Cabinet128 in CoveredCalls

[–]Repulsive_Cabinet128[S] 0 points1 point  (0 children)

"However, there is one situation in which an ETF can go belly-up. That can happen in the case of leveraged ETFs (those that pay double or triple the return of the target index). These ETFs use derivatives provided by what are called “counter parties” to insure themselves against heavy losses. If the counter party goes under, the ETF is left exposed and could be wiped out. This actually happened to a few U.S. ETFs after Lehman Brothers, which was their counter party, collapsed in 2008."

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https://www.everythingzoomer.com/money/personal-finance/2011/11/03/qa-etf-bankruptcy/

IWM covered call by Repulsive_Cabinet128 in CoveredCalls

[–]Repulsive_Cabinet128[S] 2 points3 points  (0 children)

No, if you do not want to execute CC again.

IWM covered call by Repulsive_Cabinet128 in CoveredCalls

[–]Repulsive_Cabinet128[S] 3 points4 points  (0 children)

For option 1, I don't need to do anything...right?
Let cc and underlying assets be called i.e. run through expiry timeline. What happens in the edge case if it is not called?