ETFs & Mutual Funds
Yield-Crazed Day Traders Pony Up for ‘169%’ Option-Income ETFs
- Assets in single-name option products rise above $1.7 billion
- Critics say the investment case of the trade is hard to fathom
Photographer: Jackyenjoyphotography/Moment RF/Getty Images
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How many Wall Street buzzwords can you fit into one security? The limit is being tested by a new breed of options-fueled exchange-traded funds making inroads with the retail crowd.
Nosebleed yields. Elevated volatility. Single-stock ETFs. They all come together in a parlay of complex risk taking marketed with mundane labels like the “option income strategy,” with around $1.7 billion flowing into such products since catching on last year. Issuers are planning more. Skeptics wonder if buyers know what they’re getting into.