Covered calls and cash-secured put selling are not just retail strategies — they are used by some of the largest institutional investors in the world:
- Covered Call ETFs: Products like JEPI (JPMorgan Equity Premium Income ETF) and XYLD (Global X S&P 500 Covered Call ETF) systematically sell covered calls on large equity portfolios to generate income for their investors. These are multi-billion-dollar funds managed by professional portfolio managers.
- Pension Funds and Endowments: Many use options overlays (selling calls against stock positions) to enhance yield on equity portfolios.
- Family Offices: High-net-worth individuals and family offices commonly use cash-secured puts as a disciplined entry strategy for stocks they intend to buy anyway.
- Market Makers: Options market makers take the other side of every retail options trade and manage complex hedged portfolios that include significant put and call exposure.
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