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Strategies & Market Trends : ajtj's Post-Lobotomy Market Charts and Thoughts
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To: edward miller who wrote (70400)9/28/2022 7:02:18 PM
From: Sun Tzu1 Recommendation

Recommended By
ajtj99

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Ed, I didn't get to sleep last night, so I do not have the brain power to give you detailed math on your proposal. But here's the rough sketch.

For every 100k, you can put 75% on QYLD and 25% on SQQQ.
So long as the market keeps going down, your capital is protected and you will collect net ~8% yield. You run into trouble once the market starts going up b/c QYLD has no upside participation and your SQQQ will go down in value.

My back of envelope calculation says that once the market goes up more than 2%, you will begin to lose. You can improve this by selling OTM calls on SQQQ or OTM puts on QQQ (they amount to the same thing, but you'll have some flexibility on depending on price and liquidity).

So the structure goes like this:

Allocate 75% to QYLD, 25% to SQQQ, and sell 6+% out of money calls on SQQQ. This improves your collected yield and should preserve your capital for upto ~3% market rise. It should not be too bad upto ~5% monthly gain. Again, I have not done the detailed math, so it's for you to validate.
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