Bank of America Sounds Warning on Options-ETF Boom as Day Traders Plunge In
- Yield-seeking investors push covered-call ETFs to $69 billion
- Strategy is “as unprofitable as ever,” according to BofA
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Over the last two years, Wall Street has convinced cautious equity investors to send billions of dollars into exchange-traded funds that use options to goose yields.
A vocal chorus of analysts has been warning against this booming trade, to no avail. Assets in the derivatives-powered ETFs have quadrupled to $69 billion.