Is it better to buy and hold or buy the wheel?

But both might lose vs. Cash in something like the lost decade. I think the wheel can profit off the ups and downs in a sideways market. Cash only wins if things drop way low, and even then you have to buy in at some point. Buy and hold probably only outperforms the wheel in a nonstop bull market.

What is a buy and hold strategy?

Buy and hold is a passive investment strategy in which an investor buys stocks (or other types of securities such as ETFs) and holds them for a long period regardless of fluctuations in the market. An investor who uses a buy-and-hold strategy actively selects investments but has no concern for short-term price movements and technical indicators.

Is the wheel strategy worth it?

Wheel strategy is better if you’re trying to get consistent income I’d imagine. Let’s say you have $101k in a Microsoft, dividend paying around $1700 a year. That’s about 1000 shares. If you sold 10 covered calls on it a month out your premium would be about $1500 for a 0.8 delta contract (with current volatility).

Does buy and hold outperform the wheel in a nonstop bull market?

Buy and hold probably only outperforms the wheel in a nonstop bull market. Yeah, I agree, but given that none of us can accurately predict when those bull markets will occur, I'd like to know how much upside I'm giving up during those bull markets in favor of more consistent returns the rest of the time.