The Motley Fool Discussion Boards

Previous Page

Investing/Strategies / Options - You Make the Call

URL:  https://boards.fool.com/i-am-retired-and-would-like-income-with-safety-34761906.aspx

Subject:  Re: safe cash secured puts for income Date:  2/24/2021  2:49 PM
Author:  Rayvt Number:  11316 of 11329

I am retired and would like income with safety.

You won't get that by dealing in options. The market is not in the habit of delivering risk-free profit. If you think you have found such a strategy, you are wrong.
"The lure of easy money has a very strong appeal."

Money you get by selling the upside of a stock is not "income". It is money you get for selling the upside.

A short put is synthetically equal to a covered call. Both have an asymmetric risk graph with limited profit potential and all of the downside risk (less the premium received).

opinions appreciated

When considering using a strategy, the risks are much more important than the rewards. So always do a search on "problems with {strategy}".

Try googling "problems with covered calls". Cash secured put has the same P&L as covered call, but there is much less literature since most people seem to prefer CC to CS-put.
Copyright 1996-2021 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us