The Problem with Selling Upside on Assets

I think this is the point that most people sort of have this view that Bitcoin and things tied to Bitcoin are going to go up. So this is the issue when you sell calls and you sell upside on assets that are highly appreciating. I mean, if you look at the return difference over the last year and a half, you could see that when you sell the call options, it's something like 160% of the upside you're giving up just to get that chunky yield to Ean's point.

So I think buyer beware. I do suspect that a lot of people are just buying it for the income, not really understanding what it actually is that you're selling the upside. So I think it's too much fun to just be long the stock. So I'm not a big fan of option over for that reason, especially for an asset class that most people are thinking has a lot of upside and when sized appropriately in your portfolio at 1-2%, which can provide the alpha for you. So that's my overall assessment.

This kind of reminds me of those payday loans where they'll give you your money, they'll advance you your money.

Yeah, that's exactly right. That's exactly what you can compare it to. So you're giving up the actual, like you said, that perhaps bigger potential upside in exchange for give me my money right now, instant gratification, which is probably 99% of society.