Like you said in the article the average recovery time to put yourself in the green after a crash is about three years. So for a buy and hold investor (one that doesn't use leverage) that's pretty quick turnaround in the grand scheme of things. I think the one thing that would be more worrying than that is a long period of stagflation or near zero real growth. There was a post in r/fluentinfinance that got crossposted to r/marketsentiment on reddit here:
where it showed that the market has historically had long periods of no growth followed by strong bull markets. In a case where that happens to the stock market for the next decade or so I would think that following a put writing index would be the best option because it would generate premiums/returns even in flat markets. This paper shows that a put writing index outperforms during both bear markets and down markets:
One of the more recent articles I wrote did not directly touch on this aspect of using option writing to generate returns during flat markets, but it did show that selling options on leveraged indexes statistically is about as risky as selling options on an unleveraged index given you sell them far enough OTM.
Like you said in the article the average recovery time to put yourself in the green after a crash is about three years. So for a buy and hold investor (one that doesn't use leverage) that's pretty quick turnaround in the grand scheme of things. I think the one thing that would be more worrying than that is a long period of stagflation or near zero real growth. There was a post in r/fluentinfinance that got crossposted to r/marketsentiment on reddit here:
https://www.reddit.com/r/FluentInFinance/comments/twb7ts/two_decades_of_zero_returns3_different_times/?utm_source=share&utm_medium=web2x&context=3
where it showed that the market has historically had long periods of no growth followed by strong bull markets. In a case where that happens to the stock market for the next decade or so I would think that following a put writing index would be the best option because it would generate premiums/returns even in flat markets. This paper shows that a put writing index outperforms during both bear markets and down markets:
https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.458.4882&rep=rep1&type=pdf
One of the more recent articles I wrote did not directly touch on this aspect of using option writing to generate returns during flat markets, but it did show that selling options on leveraged indexes statistically is about as risky as selling options on an unleveraged index given you sell them far enough OTM.
https://premiumincomeinvestments.substack.com/p/leveraged-income-generation?r=1awcwu&s=w&utm_campaign=post&utm_medium=web