Simple deal to do if you want to invest, when something gets to whatever % gain you wanted, sell enough to get you initial principle back and have essentially free shares. Have a friend that is a multi millionaire doing this on early tech stuff and morphed to dividend paying stocks later on. I suggested he juice the returns by selling some calls against his holdings and it makes him a nice sum every month. Not having to pay commissions is a big game changer for this as well.

Use the principle to find another investment vehicle to rinse/repeat. The bitcoin guy with 1700 is a perfect example. Sell 850 and let the rest run. It's house money!

Even if you are on the hook for a cap gains tax expense, the true cost of the investment is a percentage of the actual share cost you have recorded.

The Buffet dirty secret, he is a net seller of put options. Example - They file a sales notice with SEC for Apple selling a bunch of shares. They also are selling puts, collecting $$$$, at a significantly lower price which makes them obligated to buy shares at a price by a specificexpiration date. The option buyer can put the shares on them, if the stock price is below the sold put strike any time before expiration. Buffet sells apple, days or weeks later public disclosure gets into the market news, apple sells off and guess who is sitting there waiting for the price to fall in his lap... Gets paid to wait for the outcome they desire. Market manipulation???

Selling puts is a great way to generate income if you are comfortable owning a stock at a specific price.

Everything, even risk free return stuff, has a risk attached to it. No free lunches.

Last edited by crackedback; 04/21/22 05:12 PM.