Call me if you want to discuss this. (705-441-4566)
On November 14th, as usual every day that the New York stocker changes open, Rosi and I sold covered calls on SPY. (Only sell and never buy derivatives.)
For details, see below.
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On October 13, as soon as the market opened at 9:30 AM, I wrote covered calls on the SPY shares I have in three portfolios, expiry date the end of the same day. The strike price was $US 597. That earned $US 93.61 for every hundred shares for SPY.
Rosi and I do this every day, Monday through Friday and we live on that income. In over 50 years of investing, I have found this to yield the best results.
How risky is it?
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I want to emphasize the importance of women being involved in investment decisions.
Every day that is not a market holiday, when the market opens at 9:30 AM, Rosi and I sell (only sell and never buy) covered calls or cash-secured puts on SPY in our portfolios. On November 11, we earned $116.27 US per contract.
Given the number of board lots of SPY in our portfolios, we can live comfortably on the income.
Here is what we did on November 11. It took about five minutes.
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Chrystia Freeland is Canada’s minister of finance, which also is the equivalent of the United States vice president. Below, you can see the letter I wrote to her recently. Her response was positive, and hopefully, Canadian investors will be allowed to write cash-covered puts in their tax-advantaged portfolios as Americans can.
You can see my letter below.
Call me if you want to discuss this. (705-441-4566)
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I hate weekends. On weekends, I am a miserable old man.
For retired people, every day is a weekend. I hate Saturdays and Sundays, the weekend for working people, because I can’t make any money in the stock market.
Rosi and I make money in the stock market every day which is not a holiday. We make more than I did when I was practising dentistry.
In less than 10 minutes! Before breakfast!
Here is how we do it.
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I want to emphasize the importance of women being involved in investment decisions.
Every day that is not a market holiday, when the market opens at 9:30 AM, Rosi and I sell (only sell and never buy) covered calls or cash-secured puts on SPY in our portfolios. On November 7, we earned $137.46 US per contract.
Given the number of board lots of SPY in our portfolios, we can live comfortably on the income.
Here is what we did on November 7. It took about five minutes.
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I intentionally mention “Rosi and I” in the title of this post. Why? Women commonly outlive their husbands, who usually handle their money management.
The inability to invest can add significant pain to the emotional trauma of the death of a spouse. Investment decisions like the one I describe below should involve both spouses.
Rosi and I sell (sell, never buy) covered calls or cash-secured puts on SPY, as you see below. We do it at 9:30 AM every day that the New York stock change is open. This method of investing has earned 16% annually for over 100 years.
It takes about five minutes.
Here is how.
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Daily, Monday through Friday, Rosi snd I and live on income earned from selling covered calls and cash-covered puts. Doing so on a daily basis became possible only recently. Monday through Friday, in less than 10 minutes, we carry out the necessary steps from anywhere on the planet where we can get an internet connection.
The only way to do better than that is to do something illegal.
Here are the steps.
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I went to the local Walmart to return a defective device for credit. Walmart is very good at accepting returns for various reasons. However, they would only accept mine if I had a receipt to prove that I had bought the defective item at Walmart. I did not have the related receipt.
My mistake. What did I learn from this mistake, this practice shot? Keep receipts until you are sure you want to keep the item you bought.
Every investor has made investment mistakes, such as buying a security that declined or even went bankrupt.
Think of Enron, Nortel, Pennsylvania Central Railroad, and many others.
What about market timing, such as buying an IPO (Initial Public Offering)? The people launching an IPO know much more about the company than the buyers. Why are they selling? Why are they cashing in their chips?
Think about that.
Three years after an IPO, the average historical return is a negative 18.7%, with almost no positive returns. Almost none!
How can investors protect themselves from poor security selection? From poor market timing?
Here is how.
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Recently, one of our American members asked whether all my money except emergency money is in SPY so that I can sell options on most of my savings.
He has been selling daily options on half of his savings and doing quite well.
He keeps the other half in a 401k and will use the 50/50 approach until he retires, which will be quite soon.
My response follows.
There are many government programs designed to help older Canadians stay financially independent. For example, Canadians don’t have health care issues. Retevmo costs $32,000 a month in the US. Canadians pay a $12 dispensing fee.
So Canadians can depart from a 50/50 (or 60/40 or 45/55) or a similar asset allocation.
To make that possible, Canadians pay more in various taxes than Americans.
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