CALL and PUT OPTION SELLING FOR INCOME
Did you know that if you own stocks and are not selling options against those stocks you are leaving a lot of money on the table? A Merrill Lynch branch manager once told me that selling options against stocks is like finding money on the sidewalk. What could you do with the extra money? Buy more stock, live off the income while maintaining your current stock portfolio or keep the cash as a safety net?
Below you will find an example of the kind of income that could possibly be achieved by selling options. I can not guarantee how much you will make. Stock trading is risky, but I can show you how I have traded thousands of successful trades and how I have helped countless individuals learn to trade call and put options for income and profit.
Below you will find an example of the kind of income that could possibly be achieved by selling options. I can not guarantee how much you will make. Stock trading is risky, but I can show you how I have traded thousands of successful trades and how I have helped countless individuals learn to trade call and put options for income and profit.
While I can not guarantee a return, I can provide you examples of what I have done and a little further down you will see actual figures that were available for a specific stock portfolio on the date I am writing this. I have taught countless individuals how to trade puts and calls for income and investment growth. Many have a hard time believing that they can achieve returns like these, but these are real and can be done by novice investors as well as seasoned ones.
What is a put option?
A put option gives the buyer the right but not the obligation to sell their stock to you, the put option seller, at the set strike price.
How can I buy stocks at a discount and earn income from selling put options?
Let's say you are interested in buying 100 shares of Amazon. Currently it is trading at $258.98. What if you only wanted to pay $250 for it, how could you do that and get paid for it?
By selling the $250 put option, which is currently paying $14.45 per share, or $1,445 we are agreeing to buy 100 shares of Amazon stock at $250 per share if the stock closes below $250 on June option expiration day, forty seven days from now. If the stock is higher then $250, on option expiration day, which is the third Friday of every month, or forty seven days from now, then we get to keep the entire $1,445, no strings attached.
If on the other hand, the stock goes down and closes below $250 by option expiration day, the third Friday in June, forty seven days from now, then we will purchase 100 shares of Amazon at $250 per share. Keep in mind though that we have already pocketed $1,445 or $14.45 per share. So our actual cost would be more like:
$250 per share --> (purchase price)
- $14.45 per share --> (received for selling put option)
= $235.55 per share--> (Actual out of pocket cost)
This means we purchased the stock at a 5.78% discount, not to mention we purchased it 3.47% lower then it was on the day we decided to purchase the stock. All together we purchased the stock at a 9.25% discount! That should have us smiling very big!
This is done by investors in the know every day. I have done this thousands of times. You can do it also.
How can we make money once we buy the stock at $250? This is done by selling a call option against the stock we own.
What is a call option?
A call option gives the buyer the right but not the obligation to buy our stock at the set strike price anytime before expiration of the option.
How can I get income from selling call options?
Here is an example of the income we could receive by selling call options against a stock portfolio we currently own:
Call Days Option
Stock # Of Price Strike Strike Option Till Income Called Current
Symbol Shares Quote Date Price Premium Exp /Month Value Value
-------- ------- ----------- ------------- -------- ---------- -------- -------- -------- --------
ATVI 1400 $15.18 06/21/13 $16.00 $0.34 49 $291 $22400 $21252
GOOG 100 $845.72 05/24/13 $850.00 $12.00 21 $1714 $85000 $84572
GLD 200 $142.09 05/24/13 $142.50 $2.34 21 $669 $28500 $28418
NFLX 100 $213.45 05/24/13 $215.00 $7.10 21 $1014 $21500 $21345
UYG 300 $89.56 06/21/13 $90.00 $3.10 49 $569 $27000 $26868
OIH 500 $43.58 06/21/13 $44.00 $1.15 49 $352 $22000 $21790
AMZN 100 $58.05 05/24/13 $260.00 $5.25 21 $750 $26000 $25805
AAPL 100 $449.98 05/24/13 $450.00 $9.05 21 $1293 $45000 $44998
BIDU 300 $84.51 05/24/13 $85.00 $2.01 21 $861 $25500 $25353
ERX 400 $65.51 06/21/13 $66.00 $4.10 49 $1004 $26400 $26204
TOTAL/AVG 32 $8,518 $329,300 $326,605
Potential Capital Gain $2,695 or 0.83% of Portfolio
Potential Yearly Income $102,220 or 31.30% of Portfolio
If we owned the list of stocks above, and sold call options against those stocks, we could receive $8,518 for those options. If the stock end up above the strike price (5th column) then we will sell the stock at that price but get to keep the option in 8th column for ourselves. We can then start over again and sell a put option on that stock to try to buy it back at a lower price, all the while receiving another option premium.
If the stock ends up below the strike then we can sell the call option again for the next month.
These are the kinds of returns option traders receive every day. Learn all the details of how to buy stock at a discount, earn income on stocks before you buy them, what stocks are best to sell options on and earn income all the while requesting to purchase our full report for $49 at the link below:
SELLING OPTIONS FOR INCOME
What is a put option?
A put option gives the buyer the right but not the obligation to sell their stock to you, the put option seller, at the set strike price.
How can I buy stocks at a discount and earn income from selling put options?
Let's say you are interested in buying 100 shares of Amazon. Currently it is trading at $258.98. What if you only wanted to pay $250 for it, how could you do that and get paid for it?
By selling the $250 put option, which is currently paying $14.45 per share, or $1,445 we are agreeing to buy 100 shares of Amazon stock at $250 per share if the stock closes below $250 on June option expiration day, forty seven days from now. If the stock is higher then $250, on option expiration day, which is the third Friday of every month, or forty seven days from now, then we get to keep the entire $1,445, no strings attached.
If on the other hand, the stock goes down and closes below $250 by option expiration day, the third Friday in June, forty seven days from now, then we will purchase 100 shares of Amazon at $250 per share. Keep in mind though that we have already pocketed $1,445 or $14.45 per share. So our actual cost would be more like:
$250 per share --> (purchase price)
- $14.45 per share --> (received for selling put option)
= $235.55 per share--> (Actual out of pocket cost)
This means we purchased the stock at a 5.78% discount, not to mention we purchased it 3.47% lower then it was on the day we decided to purchase the stock. All together we purchased the stock at a 9.25% discount! That should have us smiling very big!
This is done by investors in the know every day. I have done this thousands of times. You can do it also.
How can we make money once we buy the stock at $250? This is done by selling a call option against the stock we own.
What is a call option?
A call option gives the buyer the right but not the obligation to buy our stock at the set strike price anytime before expiration of the option.
How can I get income from selling call options?
Here is an example of the income we could receive by selling call options against a stock portfolio we currently own:
Call Days Option
Stock # Of Price Strike Strike Option Till Income Called Current
Symbol Shares Quote Date Price Premium Exp /Month Value Value
-------- ------- ----------- ------------- -------- ---------- -------- -------- -------- --------
ATVI 1400 $15.18 06/21/13 $16.00 $0.34 49 $291 $22400 $21252
GOOG 100 $845.72 05/24/13 $850.00 $12.00 21 $1714 $85000 $84572
GLD 200 $142.09 05/24/13 $142.50 $2.34 21 $669 $28500 $28418
NFLX 100 $213.45 05/24/13 $215.00 $7.10 21 $1014 $21500 $21345
UYG 300 $89.56 06/21/13 $90.00 $3.10 49 $569 $27000 $26868
OIH 500 $43.58 06/21/13 $44.00 $1.15 49 $352 $22000 $21790
AMZN 100 $58.05 05/24/13 $260.00 $5.25 21 $750 $26000 $25805
AAPL 100 $449.98 05/24/13 $450.00 $9.05 21 $1293 $45000 $44998
BIDU 300 $84.51 05/24/13 $85.00 $2.01 21 $861 $25500 $25353
ERX 400 $65.51 06/21/13 $66.00 $4.10 49 $1004 $26400 $26204
TOTAL/AVG 32 $8,518 $329,300 $326,605
Potential Capital Gain $2,695 or 0.83% of Portfolio
Potential Yearly Income $102,220 or 31.30% of Portfolio
If we owned the list of stocks above, and sold call options against those stocks, we could receive $8,518 for those options. If the stock end up above the strike price (5th column) then we will sell the stock at that price but get to keep the option in 8th column for ourselves. We can then start over again and sell a put option on that stock to try to buy it back at a lower price, all the while receiving another option premium.
If the stock ends up below the strike then we can sell the call option again for the next month.
These are the kinds of returns option traders receive every day. Learn all the details of how to buy stock at a discount, earn income on stocks before you buy them, what stocks are best to sell options on and earn income all the while requesting to purchase our full report for $49 at the link below:
SELLING OPTIONS FOR INCOME