[trader220]

Originally Posted by competentone

Options could give more "leverage" -- and potentially higher returns -- but that leverage can work both ways and one can lose more money faster too. (The TBT and PST are double short ETFs, so they are giving leverage already.)

With the volatility as high as it's been, the premiums for options can be quite high -- but that can create good opportunities for those holding the ETFs, or stock, (like Wayne) to write covered calls against the positions and make some good percentage returns.

One could work a complex options position, but for the more average investor, keeping the trades "simpler" is sometimes best.

I like Wayne's short Treasury position (much better than getting long Macy's and GM!); now we just need to get him to buy some gold and silver (and palladium too).

I am not talking about shorting any options so your risk is limited to only what you paid to leverage your long position synthetically in the ETF. The only time you get into a situation with options where you have unlimited risk is in shorting options.
Long stock, or in this case the ETF plus short call ( ie. Covered calls) is the synthetic equivalent of naked short puts and that’s where you have significant risk.
As far as a “complex” options position I would hardly call some sort of vertical call spread really complex and you could achieve similar long deltas.

Good thread going!