My mom made money pretending to buy stocks
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Anonymous
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And it was over 30%in 1Y!! I took over investing Moms IRA account in 2022 first trades were in April so almost a year. She stated, "I don't want to own individual stocks". I later got a soft commitment out of her that she would be open to buying stocks with the profits from the account, but we would "see how it goes". She had a bit over 160K to invest.
Now in steps the "pretending" part. So if a stock is at $50 and you're going to bid $48 bucks that's not really pretending to buy ( a limit order could be filled on a dip) but what if I was bidding $40-$42? That was a fill probably less than 10% of the time. And sub 40 for a currently trading $50 dollar stock I mean forget about it depending on the stock thats "pretending to buy" on many stocks so that would fit Mom's profile she did agree to "pretend". SO additional backstory... I've traded stocks since I was a teenager, but I learned a valuable lesson that I still follow to this day on how to buy them in the first place from a Smith Barney trader (yea I'm old). He basically advocated for patience when entering a position gradually like over 6 months to even 2 years. He also said on the patience part to "get paid while you wait". The tool he used here was Put Options. Everyone poo poos Options and what they can do for a portfolio but many of the concepts are easy to understand not as risky as you think. Selling a Cash Secured Put is the same as buying a stock with a bonus attached. Any CSP I'm entering is an order that can be "assigned" to me, (that's the BUY the stock part) and I stillhave to have the cash in my account to buy the stock. I get to dictate stock entry price (known as the strike) (hey this is the same as a limit order!) that I am willing to enter. But here is the paid while you wait part. Just for entering an order to buy a stock with a Put option you get paid a premium. This intrigued me so much back then that it's the only way I ever buy stocks now. Buying off a Cash Secured Put option. The only caveat is you have to have at least enough cash in your account to buy 100 shares of that stock at whatever strike price you choose. Back to Mom! Hey Mom so what kind of phone do you have?? Oh APPLE iPhone.. well lemme tell you it's a great co... April of 2022.. 170 a share. "yep agreed" But..." I don't want to own Apple stock" No sweat we are not buying APPL here or anytime soon. on the off chance I can get you to pretend to like APPL between now and next Friday at say 155 a share would you play along in this game for a sec? Some consternation and anguish there but settled on "ok for no more than the 155 and Max 100 shares". "Gotcha Mom". Put Option sold wasn't the greatest premium but $88 bucks in the account for 5 days.. Not bad..( minus a trading commission oh well no way to avoid that it was $10 extra so $76. This goes on with APPL for another week and she later agrees to all the shares she can "pretend to buy" (I'm saying pretend here again as a way to show entering into a Put with the possibility of buying APPL at 155 when the stock is 170 (and it has to happen in a week) is as good as pretending to buy it aka it won't likely happen. The very next week she had enough $ to reach a little more on the Put so 158 Strike, 10 contracts ( she's trusting this now!) Boom- $1900 in profit!! Anyway this goes on each week for the year or at times 2X a month..the best haul in a week?? $9200! worst? -$1100, Net for the year (it hasn't been a year yet) $51,616! ** the only reason I had a negative week trade was there was a large drop on APPL and since Mom didnt want to own APPL stock I had to buy back the PUT that week at a higher price than what I sold it at. ( if I would've let it go she would've "owned the stock" but since she refused to own it I tt her about what we could do and went that route. She was fine with how that week turned out. 2 or 3 other weeks in the year I netted $0 APPL may have dropped with the market and I went into the trade too early. At least 4 or 5 weeks I didn't as aggressively pursue much of a weekly win due to APPL or market announcements that I thought might produce a larger than normal drop ( although some of these weeks were quite profitable with elevated premiums during the drops you just had to wait for the dust to settle or adjust the strike price entry. h **I later repeated this with TSLA which was the big cash in at $9200. Mom still doesnt own APPL or any stock shes just "getting paid to wait"! Not bad for pretending 
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Anonymous
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Lordy, OP. You're incredibly tedious and silly. Your short term thinking won't make you millions, I guarantee that. - Long time Apple and Amazon, etc stock owner, not messing about with small change puts or other garbage. |
Anonymous
| Shouldn't you be on Stocktwits or something? |
Anonymous
OK, you give people advice on how to make millions, smarta$$. --not OP |
Anonymous
| Congrats OP. You're trading options with your mom's money without disclosing or explaining to her what you're doing. I hope you're ready to make her whole when you accidentally wipe her out. Also, you're a pretentious douche bag. |
Anonymous
Short term? Compare my approach on TSLA to people that paid $110 a share (its recent low) Yea wow they were so lucky and focused on the long term...uh what? Big deal you got TSLA at 110 surely you sold it when it was $215 two weeks ago right? When TSLA reaches $135 later this year I will have already collected $120 per share in premiums! There were premiums two weeks ago of over $11!! My basis in TSLA would be $15! ($135-$120). were you able to buy TSLA at $15 recently? I dont recall seeing that price? My example my mom didnt want to own the stock she may change her tune on that in year 2. Surely since you already own AAPL your collecting premiums on covered calls right? Covered calls on APPL would net you at least $40 a year but yea thats just garbage |
Anonymous
Ok wipe out?? hmm your showing ignorance to what this is..You don't "lose" selling Put Options. You are agreeing to "buy" a stock at a certain price. Yea if I entered an APPL Put at $140 expiry next week something really nuts would have to occur to get it that low. I'd also think whatever market meltdown did occur that produced that drop could be temporary. How would a purchase of APPL at $140 accidentally wipe me out? Once the shares are in the account they can be sold or used as collateral on a Covered Call option. |
Anonymous
| I guess some people need the silly story, but you could have just said that selling put options is a way to make some money while waiting for a stock you like to decline to a price you’re willing to pay. |
Anonymous
That’s incredibly easy. Buy the stocks that will go up in value many times over. Np |
Anonymous
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OP: Terrible advice. All you are doing is attempting to rationalize a crazy idea.
However, there is a somewhat related idea that is a proven moneymaker. It's called selling covered call options. |
Anonymous
It is easy thats my whole point. Also nice to have profited like this on APPL and TSLA despite not owning it! APPL down 8% YOY and TSLA down 24% YOY. |
Anonymous
I sell covered calls on every position I have..yep free money. Surprised to hear you think its terrible advice meanwhile its the same thing as a covered call in concept except that you don't already own the stock. You know how the premiums get nicely inflated on all the strikes when you do your covered calls? Look over on the PUT side of the chain when there is a similar thing occurring on a price drop. buy Why would anyone hurry up and buy a stock when you can just get paid PUT premium every week and buy it later on? |
Anonymous
Ignorance? You're the one claiming that there is no risk in selling a cash secured put option. That is wrong. |
Anonymous
Sure. I bought Apple and Amazon when they were cheap. I made my millions, thank you very much. You are free to retort that it was pure luck. I continue to invest in tech stocks I like. |
Anonymous
| Stop screwing around with your moms money |