Have you ever thought of owning investments without the risk of downside, while also not losing out on returns? I am not talking about boring returns from T-bills or other "safe" financial instruments. Rather, how about a return from a diversified portfolio - a portfolio like the SPDR S&P 500 ETF Trust (SPY)? Also, imagine that you do not have a lot of money in your brokerage account: $AAPL, Apple Inc. / 60 Here is a solution for you: replicate the ETF with other cheaper ETFs and buy options on them. We know what sectors and in what proportion the capital is allocated to them in SPY thanks to the information provided by its management company, State Street Global Advisors:(Source: SPY's Prospectus)With this, you will kill two birds with one shot: you will further diversify your portfolio and you will increase your expected return with the remaining cash balance invested in short-term bonds or kept in a savings account. Keep in mind however, that the transaction costs will affect your expected return. Here is what it looks like:(Source: Google Finance. Calculations by author)As you can see in the illustration above, you can replicate SPY's exposure with a few like ETFs at the third of the initial cost ($7K vs. almost $21K). Furthermore, you can simply buy options expiring in November 2016 or January 2017 and spend twelve times less than that and put the remaining cash into an ETF like iShares Barclays 20+ Year Treasury Bond ETF (TLT) or into a savings account to avoid any volatility. You can also see that this strategy costs 40x less than buying 100 shares of SPY and over four times cheaper than buying SPY's calls with similar duration. Perhaps, the best benefit of this simple strategy is that your losses are limited to about 10% of the current market price of the selected ETFs (or 100% of the options' prices). The cost of the options is somewhat reduced by the sale of out-of-money calls, which obviously limits the upside. To avoid missing a lot of upside, I recommend selling options with strike prices about 20% higher than the current market price of the ETFs. Data show that there is a very small chance missing out on returns higher than 20% in less than one year.If your transaction costs are not forbidding, consider replicating 100% of your portfolio with this simple options strategy and park the rest of your money in a safe harbor without missing out on the upside!