Alanrs: I'm in the evil landlord business, too. We're having a bit of a recession here in Atlanta. I've had a vacancy for a couple of months that I'm having trouble filling. All the apartments are having it, too. I'm seeing signs advertizing "Free first month's rent", and "Movein specials". Ugh.
I've been paper trading CCs using QQQ as the underlying rather than individual stocks. Has a lot going for it. First, you can pick from a lot of strike prices. Second, you don't have to worry about when an individual stock's earnings are announced. Third, you avoid having a single stock experience bad news and blow up on you. Fourth, it's easy to follow.
The tradeoffs, as I see them, are reduced opportunity for large capital gains. Sure, you can sell OTM calls and make a little, but I've found that you will experience the best premiums by writing close to ATM. Also, QQQ moves with the NASDAQ, so you can't 'beat the market' with your superior stock picking skills. If the market tanks, so will your QQQ. True, you have buffered your capital loss by writing the calls. Also, you feel less 'ownership', which makes it easier to detach the feeling of wanting to hold the shares regardless. Who can get emotional about QQQ? If you get called, great! Buy 'em back and write again!
Adairm |
