If you've seen the H&R Block commercial on television
recently, you know that it starts with a concession worker
putting $500 on every seat in every stadium across every
professional sport... that represents $1 billion dollars that
went unclaimed by taxpayers last year.
Now imagine that instead of $500 on every seat, its $2 million
on every single seat in every single stadium across all
That adds up to $790 trillion dollars.
To put that amount into perspective, that's more than 21 times
larger than the total value of all the stocks in the world.
That's what many investors are leaving on the table by not
venturing into the world of options.
If you've read my previous essay about how investors can earn
a 24% annualized yield from Verizon (NYSE:
), then you know I'm talking specifically about put options.
Simply stated, put options are one of the safest ways
investors can use options to generate income. We do this by
targeting safe, reliable stocks -- many of which already pay
healthy dividends -- to multiply our income.
This strategy allows us to earn much more income in much less
Let me explain...
I know from years of experience as a former bond trader and
private wealth manager in Chicago that there are other, more
lucrative ways to get income than simply waiting around for
dividend checks to appear in the mailbox.
In fact, thanks to a little-known yet thoroughly proven
strategy, there is a way to multiply the best yields in this
dividend-friendly market, while simultaneously reducing our
long-term exposure to holding the stock should the market
I call it the "Income Multiplier" strategy.
Simply put, this strategy identifies stocks with the potential
to multiply the income you'd receive from normal dividends. Then,
you capture immediate income and reap the rewards.
My readers and I do this by selling put options. (Here's an
example of how Warren Buffett uses this method.)
You see, when we write a put option on a stock, we are
predicting that the value of that security will not fall to a
specific "strike price" within a certain amount of time. For each
put option we sell, we collect a premium up front.
That's immediate income... Cold, hard cash in our pockets.
Once we've collected the premiums, there are two possible
outcomes, and they're both good.
First, the put option can "expire worthless." Don't be fooled
by the term. That's the best possible result for us. This means
that the stock did not fall to the "strike price," and that
premium we collected becomes straight profit.
The other possible outcome is that the stock does fall to the
strike price. In this situation, we are provided the opportunity
to buy the security at a discount to recent prices -- usually
lower than the stock has been trading in a while.
And since my strategy only selects put options on stocks that
you'd be proud to own -- great companies like Microsoft (Nasdaq:
), Verizon or Coke (NYSE:
) -- this means that if we don't end up with pure profit in our
wallets, then we own shares of America's most reliable stocks at
a discount (and the large dividends they are providing right
Over a six-week test period, prior to launching my put selling
newsletter, Income Multiplier, I wrote six put options. They all
expired worthless, leaving us with yields much larger than simple
dividends in much less time.
You can see the results in this table.
And since launching my newsletter in April, I've added seven more
successful trades to my track record, which you can view below.
Though nothing comes without risk, I've been able to generate
a profitable trade every time so far using this put selling
Sure, companies are offering tempting dividends right now.
We'd be happy to own any of the stocks mentioned in the table
above. Many of them, like Microsoft and Exxon, are great core
holdings for income investors. But my point is that while now is
a great time to be an income investor, there's an even better way
to earn income.
If you want to start collecting more income from stocks like
these, then I invite you to watch this
. In it, I discuss exactly how we collect these yields of 36%...
47%... even 87% from America's favorite stocks. I've also
included a special offer for this new service, including a
step-by-step guide and a "look over my shoulder" tutorial.
To access these materials, go here
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