Gyroscopic Investing

Max My Interest

Heard the guy behind this interviewed by Meb Faber, sounded really cool.

Kbg wrote: ↑Sat Mar 20, 2021 8:35 pm I've been selling weekly 5 delta OTM covered calls on my holdings. With Interactive Brokers you can bring up one of their option tools and pick a delta and display its associated annualized yield. It's a lot of trading every Monday morning. With calls that far out assignment is rare. I've been assigned once this year and when I get assigned I start selling ATM puts until I'm long again. Probably don't want to do this in a taxable unless it's a trading account and you expect lots of ST gains.

For VIX futures, depending on how big a club you want to swing you could go the VIX options route which are $100 a point vs. $1000

kbg, how has the 5 delta strategy been working?

I just started dabbling in weeklies on GLD, SLV and TLT. All will expire worthless, so far so good. (I am amazed, I could still make $3 a contract on TLT 11 minutes before expiration, with a large distance between price and strike. Sure, only $3, but for pressing like 3 buttons...?!)

Years ago, I sold covered calls trying for income, and got burned because the underlyings all dropped hard during the financial crisis.

This time around, since my plan is to hold the underlyings in the PP perpetually, I think it may work better.

I have been looking at selling way ITM calls alternatively, specifically on SLV. Some articles got me thinking about it.

For example, I can sell a monthly SLV 19.5 call right now and pocket the premium. And get about 6% downside protection. After I get called out (ideally) I rebuy and do again, 12x a year, with the current effective rate being about 13.5%.

I am mentally trying to compare that with going OTM at a strike that gets me similar effective returns. Some potential upside here, but no protection.

Thoughts?

How's this for a scheme?

You buy CDs using a 2% cash back credit card and you instantly have a 2% tax free return.

I know someone who's been doing this for years.

Don wrote: ↑Fri Jan 07, 2022 4:42 pm How's this for a scheme?

You buy CDs using a 2% cash back credit card and you instantly have a 2% tax free return.

I know someone who's been doing this for years.

You're talking about certificates of deposit, not compact discs, right? How do you buy CDs (the certificates) with a credit card?

Xan wrote: ↑Fri Jan 07, 2022 4:52 pm

Don wrote: ↑Fri Jan 07, 2022 4:42 pm How's this for a scheme?

You buy CDs using a 2% cash back credit card and you instantly have a 2% tax free return.

I know someone who's been doing this for years.

You're talking about certificates of deposit, not compact discs, right? How do you buy CDs (the certificates) with a credit card?

I did, for years, take cash advances on my credit cards when they were offered at 0% for 6 months to 12 months or so, and deposit that into my now famous 5% money market. Now that was risk free.

Yes, I'd like to know where you can buy CDs with a CC as well!

Xan wrote: ↑Fri Jan 07, 2022 4:52 pm

Don wrote: ↑Fri Jan 07, 2022 4:42 pm How's this for a scheme?

You buy CDs using a 2% cash back credit card and you instantly have a 2% tax free return.

I know someone who's been doing this for years.

You're talking about certificates of deposit, not compact discs, right? How do you buy CDs (the certificates) with a credit card?

He has one place that allows it but I don't know what that is. I don't think I even want to know.