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Generating Income with Cash Secured Puts
Options are often seen as speculative instruments for traders, but many investors use them to generate income. In fact, the most sophisticated option traders use them to reduce risk, limit downside and boost the income on a stock portfolio. While covered calls are the most popular income strategy, there are several others that investors should […]
How to Protect Gains with Options
Most investors are happy with unrealized gains, but there’s always a risk of loss until they sell. Fortunately, there are a couple of options strategies that you can use to protect gains by locking in profits without immediately selling your stock. The key is finding the strategy that provides the right level of protection, upside […]
Calls and Puts: The Basics of Trading Options
When most people think about investing, they think about trading stocks, but that’s not necessarily the only (or best) choice for those looking to generate income from an investment portfolio. The trouble with regular stock trading is that you need a significant amount of money upfront to get started, and, in addition to choosing the […]
Buying Protection with a Married Put
The stock market is known for rising during both times of euphoria and fear. For instance, the stock market hit record highs during the COVID-19 pandemic despite extremely high levels of unemployment, a sharp contraction in gross domestic product and lofty equity valuations. Investors that continue to hold stocks during these times may worry about […]
Best Option Trading Strategy for a Portfolio Paycheck
There’s an option trading strategy that’s practically a hidden reservoir of monthly income generation lying in your own investment portfolio’s proverbial ‘backyard.’ Becoming aware of this strategy and learning how to use it empowers you to start generating real income from your portfolio, quickly. While you may not have known about this great opportunity to put […]
Can I Trade Options on an Index
Passive investing has exploded in recent years. Investing in broad-market indexes has surged in popularity and costs less than ever before. You can take this approach to the next level by incorporating option trading in addition to index investing. The easiest way to trade options on an index is with the use of Exchange-Traded Funds […]
How Do Cash-Secured Puts Work?
Options may be notorious for their speculative use, but many investors use them to generate income or achieve other goals. For example, cash-secured puts provide you with an alternative way to delay stock purchases and buy stock below its current price. You earn a cash premium that you can keep whether or not the option […]
Can Option Trading Really Give You Safer Retirement Income?
Option trading may sound like a risky endeavor, but like most investments, it’s only as risky as you make it. After all, stock investing can be incredibly risky if you’re investing in penny stocks, but few financial advisors would argue against a diversified blue-chip stock portfolio. The key to building income for retirement is using […]
Calls or Puts: Which Is Better for Income?
Stock options come in two different flavors, but they can be combined into countless different strategies. Option income strategies are designed to take advantage of time decay to generate a consistent income. Investors may decide to use calls or puts, or a combination of options to achieve these goals. Option income strategies are designed to […]
How the Wheel Option Strategy Works
There are many different options strategies designed to generate an income. While covered calls are the most popular, traders may also use iron condors, butterfly spreads, diagonal spreads or calendar spreads to generate income that may be less risky or more lucrative than simply buying dividend-paying stocks or conventional bonds. The wheel option strategy is […]
How to Get Approved for Option Trading
Options have become a popular way to speculate, hedge against risk, and even generate income. If you’re interested in trading options, you must apply for special permission from your brokerage. They will then assign an options level that they feel is appropriate based on your account, education, history, and other factors. Let’s look at the […]
How to Find Stocks with High Option Premiums
Stock options provide traders and investors with a lot of flexibility when leveraging returns or generating income. While there are many different strategies, success often boils down to a consistent, risk-managed approach. Option sellers must consider the balance between high volatility and stock ownership to create a portfolio that meets their income needs. Let’s look […]