Jul. 17 at 7:26 PM
@LVStrader Hitting the sell button to avoid losses is important in these newer income ETFs like
$TSII for example. They will initially get bought by speculators but there is no support base of longer term investors who have a low cost basis due to dividends.
These are the ones who will stay in the stock and reduce the magnitude of the share drop.
Almost every week there is a new income producing ETF to attract investors but their performance is only as good as the option managers. Much like a student who barely graduated med school with a C- he still can call himelf doctor.
$YETH is a good example starting at
$50 and doing Ok for several months and then plunged to
$22. The return is still bad as you could spend the same initial cash outlay in
$ULTY and get $.40 per week vs
$YETH at $.095.
Lastly, these funds are being setup to enrich the fund managers with high fees and preying on retail. The longest running YM product is
$TSLY with 153m shares outstanding and 89% owned by retail.
