Selling options for income was my number one income strategy for basically a decade.
10 years, it would outperform almost all investment strategies.
But this strategy has been on hold for over a year now.
Here’s why…
Selling Options for Income is on Pause
I’m not abandoning it forever.
It is still my favorite way to generate income.
However, now is not the time.
Let’s go back, 2013 roughly, when I started on the journey of selling options for income.
It was my first newsletter ever. It’s the strategy that got me started, and I would have never of guessed that.
An income strategy, usually boring and for older generations, I was fresh out of college running the research service.
And I did great with it.
Routinely, we would go a year or more without recording a single loss. We had some rare losses, but even after factoring those in, this conservative strategy would lead our research firm in performance.
That’s remarkable when you think about it.
All the services touting 100%, 200%, even 1,000% gains, and my income service focusing on single and double-digit winners, beat them for best performance.
The win-loss ratio was key.
We would win on 90%+ trades. Meanwhile those other strategies, which I still contributed to, would be lucky to hit 50%.
Alright, besides my accolades with this service, 2013 was a very different time than 2022 and 2023.
And that explains why it is on pause at the moment…
This bear market is not over folks.
If you want steady gains, every single month even in a bear market, look no further. My premium service – Bank It or Tank It ELITE – has done just that.
It is not without losses; those are inevitable. But we continue to find profitable trades in all types of markets.
For one extremely low price, you can get access to two premium reports – 10 Stocks Going Bankrupt and 10 Stocks Going to the Moon..
To take advantage of this offer today, click here.
Interest Rates at Rock Bottom
Back in 2013, we were still recovering from the global financial crisis.
Interest rates were sitting around 0% and any money you had in the bank was earning practically nothing.
It was desperate times for income seekers.
And we stepped in, as the newsletter industry should. Helping you find a way to generate safe, conservative income, that was multiples higher than the bank.
Also, like my article the other week, we are not fighting the Fed.
The Fed pinning interest rates near zero was supporting the economy. They were looking for growth and the steady climb in the stock market was perfect for selling put options for income.
Perfect.
Right now, interest rates are higher and the return for selling put options simply isn’t worth the risk.
You have better options in banks, bonds, CDs, and elsewhere.
There’s no need to fight the Fed and sell put options for income.
It’s not where you want to place your bets in today’s market.
One Way to Use Selling Options Right Now
While selling put options for income is on pause, there is other ways you can sell options to get an edge in this market.
Selling options as part of a spread is one way, and managing your trades, such as selling a call option on a stock you are looking to sell.
And, yes, if you have the urge to go long stocks right now, selling put options is a way to do that, collect some income and possibly still end up buying the stock.
But don’t use it as an income strategy and have the expectations a pullback is coming, and you will buy the stock.
That’s more likely now than any point since 2008.
And it’s the key reason I put this strategy on pause. 2022 was a bear market. 2023 is trying to flip back to a bull, but that is not likely in my opinion.
We’ll stay conservative, but right now the better choice for income is at your bank, through their various income products to capitalize on higher interest rates.
Regards,
Chad Shoop, CMT
Editor, Bank It or Tank It ELITE