ETF SWING & DAY TRADING

[shortterm]

cad92648,

That strategy has some disadvantages:

- the capital required is much higher than straight forward spreads
- you need to factor the cost of commissions which will hurt the returns unless you use an ultra cheap broker like Interactive Brokers
- there is an inherent bias in assuming that the underlying stock will not fall, say, by 30%. If this happens, you have lot of work to do to regain capital loss through option commissions. What if a long term downtrend sets in?

I'm not saying that it is not workable but it is not as risk free or simple as you state. The underlying probably should not pay dividends in order to avoid getting called in situations where you are short calls in the money.