Options strategy to return 6.5% annum with low risk.

S

shMark

I am a beginner in options, and was wondering if the bull put spread, and iron condor are a good way to accomplish the above, or if there are better ways.

Also, I wonder how much time it takes.

At present, I use preferred stocks, and close end funds to get those returns, with almost zero risk.

Thanks in advance.
 
If you're trading that far out (away and into the future), then a once-a-week look for a few minutes is not uncommon.

Just put your long strike on a major price point, or you'll never sell it to exit.
 
You probably want to look into SPY ETF and plan to work with its options. I would recommend against doing this with any individual symbol and stick to the SPY.

The options market for SPY is SUPER liquid with penny spreads not an issue getting fills.
 
prc117f said:
You probably want to look into SPY ETF and plan to work with its options. I would recommend against doing this with any individual symbol and stick to the SPY.

The options market for SPY is SUPER liquid with penny spreads not an issue getting fills.
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It's a trade-off, actually, against leverage and commissions. But deserves to be sketched out.
 
prc117f said:
You probably want to look into SPY ETF and plan to work with its options. I would recommend against doing this with any individual symbol and stick to the SPY.

The options market for SPY is SUPER liquid with penny spreads not an issue getting fills.
More...
You'd also be trading the most efficient options market on earth, so probability of figuring out something clever is zero.
 
So getting 6% income/year with low risk, and low time put in is not unrealistic. Are bull put spreads, and iron condors a good way to do this or are their better strategies? I do have to say that options seem rather complicated, but there is a newsletter that will tell you trades to make, so someone else is doing the heavy lifting for you.
 
shMark said:
So getting 6% income/year with low risk, and low time put in is not unrealistic. Are bull put spreads, and iron condors a good way to do this or are their better strategies? I do have to say that options seem rather complicated, but there is a newsletter that will tell you trades to make, so someone else is doing the heavy lifting for you.
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Is there a reason why you believe they know what they are doing?
 
shMark said:
Only the reviews I read of the book.
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Just as a word of warning - this book came up in July 2015 or something like that. The market has not have a meaningful blowup for a while and that's what would hurt you. I'd suggest reading a general options book first, digest the general ideas and only then going down this path.
 
sle said:
You'd also be trading the most efficient options market on earth, so probability of figuring out something clever is zero.
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AND losing IRS1254 status -- and handy and lovely thing about SPX. (If the leverage and commissions/revenue-dollar didn't do it for you.)
 
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