Selling Cash-Secured Puts vs. Book Royalties: The Best Passive Income Strategy for the Average Person: Financial Freedom, #254
By Joshua King
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About this ebook
We all need multiple income streams going into the looming recession, but how do we start?
You can sell cash-secured puts on the options market. With enough start-up cash, you can easily generate 20% annual returns.
You can write your way into an income stream if you have little start-up capital. Writing carries almost no risk (except opportunity costs), so anyone can do it. However, with such a low barrier of entry, many people start writing, which clogs the market.
If you are feeling cheeky, you can write about selling cash-secured puts; that's two income streams for one. It may sound funny, but that's what I do. Good Luck!
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Selling Cash-Secured Puts vs. Book Royalties - Joshua King
Table of Contents
MILITARY FAMILY INVESTING | Joshua King | Home of the Free PDF
Selling Cash-Secured Puts vs. Book Royalties
All Right Reserved Military Family Investing | 01 Cash-Secured Puts vs. Book Royalties
02 Financial Freedom: The True American Dream
03 This Is Why I Became A Writer
04 Selling Cash-Secured Puts for Passive Income
05 Cash-Secured Puts vs. Dividends
06 Selling Cash-Secured Puts vs. Treasury Bills
07 How to Write 1,000 Words Every Day
08 Write a Book in One Week
09 Passive Income for Creativity 106: Writing
10 How to Channel the Velocity of Money
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MILITARY FAMILY INVESTING
Joshua King
Home of the Free PDF
www.militaryfamilyinvesting.com
Selling Cash-Secured Puts vs. Book Royalties
The Best Passive Income Strategy for the Average Person
01 Cash-Secured Puts vs. Book Royalties
02 Financial Freedom: The True American Dream
03 This Is Why I Became A Writer
04 Selling Cash-Secured Puts for Passive Income
05 Cash-Secured Puts vs. Dividends
06 Selling Cash-Secured Puts vs. Treasury Bills
07 How to Write 1,000 Words Every Day
08 Write a Book in One Week
09 Passive Income for Creativity 106: Writing
10 How to Channel the Velocity of Money
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All Right Reserved Military Family Investing
01 Cash-Secured Puts vs. Book Royalties
It takes money to make money; this is usually the case. However, there are some things in life that we can create for free.
The goal of financial freedom is to collect as many income-producing assets as possible. Most of these assets require capital to obtain. Some income-producing assets are treasury bonds, dividend-paying stocks, rental properties, and coin-operated machines (ATMs, vending machines).
Becoming a writer is a way to generate income without having a bunch of capital. The only catch is that it may take two to three years to see a return on your time investment.
Five Takeaways from The Bond Book
Today, I want to compare two asset classes: options trading and book royalties. I will look from the perspective of a 40-year-old family person who may have little time to dedicate to their newfound income stream. Let’s begin.
Selling cash-secured puts for passive income. You will need a lot of capital to sell cash-secured puts for passive income. A cash-secured put is an option contract you sell to someone who wants insurance for their portfolio.
It is cash-secured because your brokerage requires you to hold the amount of money it would take to purchase 100 shares at the strike price.
For example, let’s say SoFi Technologies (SOFI) trades for $6.64. I want to sell a cash-secured put at the strike price of $5.50. I need $550 in cash in my brokerage account ($5.50 x 100).
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I would receive an $8 premium for this trade. Why would I do all of this for an $8 premium? This is why you must understand money before you trade options.
So, I would earn $8 over a $550 investment. The contract would last a month, and then I could do it again. I would earn $96 annually with the same $550 investment, which is an annual yield of 17.5%.
The going rate on high-yield savings accounts is 5%, and that is subject to decrease pretty soon. For the most part, you will earn 2-3% from a high-yield savings account.
You can earn 17% on your invested capital for a bit of work and a little risk. That’s not a bad haul.
If you increase your portfolio by ten, you would have an $80 premium over a $5,500 portfolio. The magic of options trading is adjusting your risk tolerance at each transaction or hedging your bets with another options trade.
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