Attorney · Louisville, KY · Member since 2023 · 30 posts · 8 votes
So I've been storing dry powder for property No. 2. But I have also recently been studying covered call ETFs. These pay out monthly and I've seen yields of anywhere between 8%-14%. Wondering if anyone has considered throwing money into one of ETFs (QQQI; DIVO; SPYI; JEPI)versus buying another investment property.
Lender · Florida / Georgia · Member since 2025 · 58 posts · 28 votes
10mo
Hello Felix,
Interesting topic. I know of a few investors that have sold 3/4 of their real estate portfolio to do 2 year leap options on good underlying stocks like NVDA, TSLA, META, MSFT, UNH, and a few others. Then when the leaps have reached about 40%-50% gains. They do covered calls to collect monthly income. Depending on the account size they make more in monthly income then the cash flow from holding on to rentals. They also include cash secured puts on stocks they like to have and collect premium. These investors I know prefer to diversify into this strategy over the hassle of managing rentals or dealing with acquisition costs for another rental only to get smaller returns compared to doing covered calls. However they do like the tax advantages that come with holding real estate on earned income which is why they hold on to a few rentals. This isn't for everybody and you do have to pay attention to market conditions to protect your capital.