Are you familiar with the "expense ratio policy" of the ETF "SLV"?
SLV for every dollar ,.50% goes to them. I know a person who bought
41 Jan '12 long/call contracts for 4.50 per share & then, it goes from
the strike price of 37, to 39.. ( a 2 dollar gain).. He's made $3,649.00
So, if I do my math with physical... 4,100 bought at 37, goes to 39.. that's
a gain of $8,200. Yet with SLV, $3,649 is earned. That's a difference of $4,551.
Really like the idea of being able to leverage, but this expense ratio policy...
...and whatever other components are taking a piece of the opportunity; seems
to create a raw deal (but it's one of the only games in town). Or is it? Considering
the downside risk of options it doesn't seem like much of an opportunity.
Either way, the ETF seems to win.
Thoughts, reflections? Words of wisdom?