저자: dtoptions진행자 · 외국인
요약 보기
TQQQ(3배 레버리지 나스닥100 ETF)의 장기 보유 수익률을 강조하며, 10년 평균 약 36%, 16년 백테스트 약 1,200% 수익을 제시. 다만 2022년 최대 낙폭 약 82% 등 큰 변동성을 경고하고, 대부분 투자자는 이를 감당하기 어렵다고 지적. 옵션 매도 전략은 TQQQ에서 장기 보유보다 불리하다고 설명.
다듬은 글
When it comes to trading and investing, there are several ways that are practically guaranteed to work in the long run for you to make money. There are some ways to acquire large sums of money if you're willing to take the risk. Unfortunately, most people are just not willing to take the risk. One obvious example is with passive long-term investing.
Just buying the stock market, buying shares of SPY or QQQ. If you sit on shares of that stuff in say about 10 years, if you buy a bunch of shares of SPY in about 10 years, you'll probably have two and a half times your initial investment. In 20 years, you'll probably have about seven times your initial investment, and that's without you contributing any extra income into your investment along the way, right?
That's a really fantastic return. It's easy. Why don't more people do that? Well, most people, for one thing, they're just not disciplined enough to acquire enough money to go buy those shares, and then they're not disciplined enough to actually just sit on the shares for the long term and never touch the investment.
But there's even better investments as far as things that will make you incredible returns on your money. One obvious example is this particular ETF, TQQQ, which is the triple levered Nasdaq 100 ETF. Now, because this ETF is triple levered, meaning that it is designed to provide three times the return of QQQ, the daily return, meaning it's calculated every day.
So, it has to be recalculated constantly. But if you take a look at QQQ, right? This is QQQ, the Nasdaq 100 ETF. TQQQ, its chart looks similar except the moves are three times as big. So, if QQQ is up 1% today, TQQQ should be up 3%, right? So, you'll be up three times as much money assuming you're holding shares.
Now, there's a downside if you're holding shares of TQQQ and the Nasdaq 100 is down 1% today, well, you're down 3% in TQQQ, right? Because it's triple levered. So, it's great on the upside, it's not so great on the downside, right? So, you you make a ton of returns on those up days, but you lose your ass off on the down days.
But here's the thing, does the Nasdaq 100, does the QQQ, does it tend to go up more than it goes down? And the obvious answer to that is yes. The Nasdaq 100 is a very strong index, right? It's mostly tech. Tech leads the way up in the market, right? It drives the market. And on average, QQQ ends up returning nearly 20% annually, at least over the last 10 years, right?
So, TQQQ has an annual return in the last 10 years of around 36, 37%. Uh so, and you're probably wondering, wait, I thought this thing was triple levered. Well, remember, it's triple levered on a daily basis. They have to recalculate it every day, so there's a natural volatility drag to all leveraged ETFs, not just TQQQ.
So, you're not going to get exactly three times the return. You'll get three times the return in a day. So, these are typically used by day traders for short-term trades. But if you're doing long-term investing, just buying shares and sitting on it, you're not going to see three times the return. You're going to see something more like two times the return over the long run rather than three times just because of that natural price erosion that these leveraged ETFs have.
Speaking of some of the historical returns of TQQQ, so this was first launched in February of 2010, so it doesn't have much history. That's only about 16 years or so of history. And in those 16 years, it's averaged around 37% returns annually. It's 10-year average is around 36%. It's three-year, the last three-year average is 71% returns in this leveraged ETF, and that's because the last 3 years, 2023, 2024 were extremely strong years, especially 2023 with the AI boom that happened that year.
You know, that those are three really great years where you had on average 71% returns every year for the last 3 years. And then the one-year average, so the last one year, this has been up about 35%. So again, when the market is doing well, you're going to love this ETF. Now, when the market's not doing well, you know, you're going to hate this ETF.
As a matter of fact, we can take a look at the one-year chart here. You can actually see in April, you can see in February, this thing was trading at $45 a share, and then in April, it was trading at $17 a share, right? It lost almost two-thirds of its value in 2 months. Now, imagine you were sitting on, I don't know, couple of million dollars worth of shares in this.
Your $2 million investment, you know, now is like, you know, what, 700, 800,000, you know, in 2 months. Would you be happy with that? Well, if you're one of these people that can't handle just buying and holding and sitting on your hands and riding these huge P&L swings, and many people can't, you know, that that's something to consider.
So, if you're using this as a long-term passive investment, just know, if you're one of these people that are a little squeamish, you know, if it's going to really upset you that on occasion, you're going to look at your portfolio and be down potentially 50, 60, 70%, you know, off your highs, you know, that's something to consider.
Let me switch over to my web browser. If I do a quick Google search of TQQQ ETF, you get a stock chart here. And let's do max. So, this is the max history, and you can actually see periods where this thing has lost, you know, 70% of its value or so. Here, this is COVID, right? So, February of 2020, we're trading at $13 a share, and these are all There's been splits along the way.
This was not the share price back then. They have to keep splitting the stock, otherwise this thing would be thousands and thousands of dollars a share by now because of its strong performance. But uh split-adjusted, this thing was trading about $13 a share, and then a couple of months later, you know, the COVID crash, it's trading at $4 a share, right?
So, that's a gigantic decline in price. Here in 2022, which was a horrible year for the market. The S&P 500 was down like 20% that year. So, just keep that in mind for the whole year. So, if we look at 2022, we start the year somewhere around $40 a share, $42 a share, and then by the end of 2022, start of 2023, we're down around $10 a share, right?
So, that's a 75% drawdown, right? That's That's massive, right? But you can see, if you just sat on your hands the whole time and held it, you know, you've turned what started at trading, well, again, split-adjusted, something that was trading at 22 cents on its inception, now trading at $54.04, right?
Just massive, massive, massive returns. So, let's take a look at a compound interest calculator. So, I typically use the one over here at investor.gov. If you just do a Google search for a compound interest calculator, this is usually the first thing that comes up. And let's say that you start with an initial investment of only $10,000.
This is This should be a easy amount of money for people to come up with. If you can't come up with 10 grand as an investment, you really just You should You have no business investing yet. Like you need to work a job and save some money cuz this is a really small amount of money. You really need to start investing with more money than this.
But let's imagine you start with $10,000. And let's say that you have 10 years of time just to sit on this $10,000 and estimated interest rate, let's do QQQ. Let's imagine you put this $10,000 into just the standard non-leveraged QQQ ETF. Over the last 10 years, I think it averaged 19%. So, let's do 19%, and then calculate that compound frequency annually.
Let's do the calculate. And your $10,000 in just 10 years is $57,000. Now, that is an insane return. Naturally, if you had done 100,000 as your initial investment, you would be sitting on $570,000 in 10 years. Just absolutely insane. That's for QQQ. Now, let's imagine you do the triple levered TQQQ.
We'll also do the last 10 years, and the last 10 years average annual returns in TQQQ were 36%. And now let's calculate that $10,000 initial investment in 10 years. Just $10,000 is $216,000. That's incredible. And of course, if you had started with $100,000, you would have $2.1 million in 10 years. 10 years is nothing for long-term passive investments, right?
Because honestly, you probably got 20 years at least. So, how about $10,000 sitting on it for 20 years at a average annual return of 36%. Now, you don't know if the future will deliver 36%, but that's what it's averaged over its life so far. So, let's use that. In 20 years, $10,000 would be $4.7 million.
And if you hit 30 years, assuming this ETF's still around in 30 years and still delivering that same kind of return, well, $10,000 would be 100 $1 million. Now, again, there's going to be some massive drawdowns, especially We've talked about, you know, sometimes you're going to see drawdowns of 70 or even 80% in your account.
And can you handle that? Well, if you start with $10,000 and you wake up one day and your $10,000 is $2,000, are you going to be upset? Yeah. But is that life-changing money? No. But let's say you've been in it for a few years, and you've taken your $10,000 to say $100,000. And then one day you wake up and that $100,000 investment that you had the day before is now $20,000.
Are you going to be upset? Hell yeah, right? Or now you've taken your $10,000 and let's say you've been in it for more than a decade and you're staring at possibly half a million dollars, right? And then, you know, you wake up one day and that $500,000, right? That half a million dollars now is less than a 100K.
You know, you're probably wanting to jump out of a window at that point. So, can you handle the wild P&L swings? If you can, this is a fantastic long-term strategy. But here's the thing, most people are not wired to take those huge P&L swings. That's why you don't hear a lot of people talk about TQQQ as a long-term passive investment.
Most people would much prefer the non-levered QQQ even though it's not going to have the same returns, you're not going to, you know, just want to go and, you know, drive your car into a brick wall on some days when you look at your account. Now, I don't typically talk about long-term passive investments on this channel.
This channel's mostly about actively trading options, especially. Can you trade options on TQQQ? Yes, there are options and there's pretty decent option markets here. Now, are you going to have the same kind of returns constantly trading options rather than just buying and holding? Well, in this product, no.
Uh if you're looking for crazy outsized returns, you need to buy some shares of this and just sit on it because just actively trading options does not work well. It works well in the non-levered ETF QQQ. If you just want to go and sell puts constantly in QQQ, it works fantastically. But in the triple-levered product, it'll be a profitable strategy, but it won't come close to just buying those shares and sitting on it because of that extra leverage of the shares.
Let's do the past 5 years and let's do a short put in TQQQ and let's sell Let's go and sell the 20-delta put and let's do this every 60 days. Let's do this every Friday, so once a week, every Friday, let's exit at 21 DTE or 50% max profit, whichever one comes first. Standard kind of short put rules here.
And let's run the back test and then we'll compare it to the result of buy and hold. And the back test has completed and you can actually see that in the back test, my short put strategy had 150% return on investment, right? But you can see the buy and hold strategy only had 40% return on investment.
Now, this is really interesting. I said the short put strategy probably would underperform, but it outperformed in this 5-year period. Why is that? Well, this 5-year period included that 2022 year where, you know, you're we're down like 75 or 80% on your TQQQ investment. You can actually see the gray line here, you know, in that year saw a steep drawdown.
And that just killed you where you didn't take that kind of drawdown selling put options. So, let's go to a new back test and instead of doing the 2022 year, so let's only do the past 3 years, so no crazy down market here. So, this is going to be mostly a bull market. And here you're going to see, well, the buy and hold strategy is greatly outperforming the option strategy.
So, uh it'll depend on what kind of data you put in for the back test. If we back test the entire history of this ETF, so if I go into Is there the custom date option? The inception date of TQQQ is in 2010. Well, let's just go 2015. We'll do like a 15- or 16-year back test here. We'll do January 1st of 2015.
So, this really encompasses a lot, right? As far as you get some up years, you get some down years, you get the COVID crash. You get some stuff here. So, this is a much more representative a back test. And you can see, yeah, we're greatly outperforming and we still haven't hit COVID yet and COVID going to be nasty to the buy and hold and then 2022 also is going to be really nasty to the buy and hold, but I'm betting that it's not going to be enough.
I think buy and hold's going to be a lot better here. Now, one thing to note is look at, you know, the orange line is our short put strategy, massive drawdowns, right? And then the gray line, the buy and hold strategy also massive drawdowns. Both of these are really tough to stomach strategies and most people are not going to have the balls to run either of these strategies.
So, that's something to consider. I know I for sure I'm not going to just sell a whole bunch of naked puts every week in TQQQ. I There's no way I could handle that. And the back test just completed and these are some crazy, crazy numbers here. The back test for buy and hold over the last nearly 16 years is 1,200% returns, right?
So, that was That's a a crazy amount of money as far as the returns. Now, our short put over that same time period, 185% return over that 16 years. That's not great, you know, because we would have done better doing this in a standard market ETF like QQQ or SPY or something like that. So, the triple-levered ETF short puts over and over, your short put campaign kind of strategy that you'd typically do on a market ETF really doesn't do all that great in this where buy and hold does outstanding, but the problem is with buy and hold, the max drawdown was that 2022 year.
The max drawdown was actually nearly 82%. You know, could you have stomached that drop right there? Uh if you can, this is almost seems too good to be true, right? It's practically the ultimate passive investment strategy. Again, if you have the balls to play it. Just some food for thought. Peace, guys.
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