Yes, that was the point. NUSI won't flash crash and you won't wake up next week down 30%. Most any equity based ETF I am aware of that uses derivatives is subject to bleed out over time if the market goes in the wrong direction for an extended period of time. You would have time to see the trend and make a decision. IMO NUSI is better than most of the other covered call ETFs given high valuations. Give it five years and some of the others won't exist or have little AUM. Most of the other high yield options just get hit, and you wait for your capital to hopefully return while hoping the dividend doesn't get cut again. They usually have real estate and/or interest rate/bond market risk.
6% is about the upper limit for yield that doesn't involve significant risk of capital exceeding 10%. You can do that with preferreds usually.
6% is about the upper limit for yield that doesn't involve significant risk of capital exceeding 10%. You can do that with preferreds usually.