Feel I really dodged a bullet here. Put about 100k into several high yield covered call yield traps in my IRA. Luckily no tax implications. Knew better. If it’s too good to be true…..
Started May 1 and was doing ok for a while. Nice distribution, but along with it, the dreaded nav erosion.
Watched my total return start shrinking and kept dripping. I’m about 8 years to retirement and finally pulled my head out of the sand and saw these funds for what they are. Maybe ok if you are in the consumption phase, but while accumulating not a good choice for sure. The capped upside is for real.
Since May 1 my total gain was 2.1%. Lost out on tons of opportunity gains during this historic run up.
So just went back to were I was. Indexed low cost funds. BasicallyVOO and chill and will sleep well at night.
Fortunately I left my Roth and 401k alone. Didn’t go all in. Saw some scary stuff on other subs. Peeps were deep into margin, Heloc’s, loans ect.
Would advise anyone to think twice about these funds.