if you won the lottery

[Murminator]

Keep workin at my same lame A$$ job.....























....Yeah right

[Cameron]

Originally Posted by Delphinus

20% yield, wouldn't that be nice. Beats the -25% that seems to be more standard these days!!! I'll settle for a 2% yield nowadays! Heck, 0% would be better!! For crying out loud.

Here's an example:

Say you bought 100 shares of company ABC for $14. You could then write a covered call option, a month out, with a strike price of $15, and receive a premium of .70 per share.

A few things can happen.
At strike date:

You get assigned on or before, and make $1 per share, plus the .70/share option premium, 1.70, on $14, in a month. Annualized return: 145%

You don't get assigned, meaning you keep the premium and still own the shares. $.70 per share on $14 and still own the shares. Annualized return: 60%

Share price goes down to $12, you can buy back the option you wrote for $.10/share, you still own the stock, and have made $.60/share. Annualized return: 51%.

If it is a company you like then it should go up eventually.

Disclaimer: Options are not for the weak at heart. This is not a recommendation, just an example of what could happen.

[Delphinus]

Yeah, that "could" happen. But my point was that you can't just go out and get a 20% yield. Luck is a big factor.

You could win a lottery for example, pay off some debt, maybe buy a car because your current one is a clunker, and use the excess to say catch up on some badly behind RRSP's and invest the rest in some investment scheme of your favour ... and then watch as it disappears at 20% to 25% just like everyone else's savings are disappearing.

Just sayin' ... Your mileage may vary, but I'm just sayin' ... that's all.

[Lydia]

There's always Kiva to invest your money in - you put money in, you choose who to lend it to, they pay it back, you take your money out (or re-lend). 100% of what you put in. I've been 'investing' money like this for almost 2 years. You make no financial interest, but it feels good to help someone out, and it's doing better than the market by far - LOL