The Fed had several meetings and the traders and markets all react bad this week. Rightfully so with interest rates on the rise and fears of inflation. Now that house loan will cost you thousands more over time just from a few words spoken and that is only going to get worse this year. We were on vacation all week so wasn’t even paying attention, now that I’m back at the computer it was exciting. Markets dropping so some good stocks on sale.
As of 4/7/22 we are selling Macy Puts for a yearly average of a 90% return last week and next week, we have a long term hold in AT&T, so sold some Puts there for a nice return of 38%, Bank of America 39%. Pushed out some other trades like Tesla. Others are trading AMD and Harley Davidson, our Dicks sporting goods and Mara both expired last week worthless. We are also adding to our dividend holdings but we do that when the market is up or down but definitely a better deal when its down. Those are our assets that just keep on giving to us and we hold forever.
Increase your financial knowledge, invest in yourself, become a sophisticated investor, get some good tools, join a community.
The software tool I use and community I learn trading from is the PowerX Optimizer from Rockwell Trading. I have learned you pay for good advise, accountants, taxes, business. I invest in tools that bring back money ten fold, like anything you get what you put into it and this is by far the easiest system I have ever found! Educate yourself and get a good tool.
The effort I spend to make money is … well you wouldn’t believe me but I left my corporate 9 to 5 job and trade a couple hours a week. It is a hard choice walking away from things your are taught but once you educate yourself you can never go back to that flavor cool aid, haha. Short and sweet but I wanted this out before Monday morning, coincidentally Monday is one of my favorite days now. Can not wait to see what the markets do and maybe finish up the work week by 10am.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
I always thought of life as a game: This may get a little nerdy, haha. You start out small and try to level up your character, you do small quests and hunt little animals for experience. You save all the coins you find to try and get better weapons and armor to hunt bigger and bigger creatures for more experience and more coins. Rinse, repeat over and over again. This is similar to your career, you start out and work your way up the ladder getting promotions and more money. It takes a long time and your are doing things that aren’t that fun, boring , monotonous but slowly progressing to get that ever higher goal you are reaching for. Some people are even stuck or don’t want to progress anymore just saving their coins for things they want etc. I did this for far to long before realizing there was a simply way of skipping all of that.
Just like a game there are tips and tricks. There are secret areas and ways to get ahead faster so you are jumping over those goals ever faster leaving people behind that are just playing the game and going through the motions. if I need more experience or coins I going to certain areas and just grab some. If I want that new Armor or weapons I just buy it not even looking at the price. When I run out of coins I just go grab some more.
Gaining more and more assets in our real life is similar to those tips and tricks. We keep acquiring more assets and in turn they buy more assets. If we want to get that shiny thing, we just buy it not looking at the price. When we are running low on coins, we just go and get some more! We are always gaining experience , you don’t stop learning otherwise you will stop progressing.
You never get rid of your assets to buy something, if you do sell one you are buying another better one. You keep these forever and you can pass them along to family or charities. The assets are your secret to leveling up in life.
Once you fully understand this and really, I mean really understand it. You will be out of the Rat race and just enjoying life. When you need some coins just go grab some, there are infinite amounts out there within reach. I’m going to go play Xbox now while my assets are putting money in my accounts.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
I was told never to use leverage and absolutely never borrow to invest. The only type of leverage I had ever knew about was your home mortgage or a credit card or two. I had heard a horror story from my neighbors having a balloon payment due on their house and trying to get the money together before they were kicked out. That type of mortgage has very small payments and then a few years down the road, boom you have a $30,000 or $50,000 payment due. I was young and thought at the time why didn’t you plan for this payment or why even get a loan like that? I know now in real estate there are several types of loans just like there are different types of insurance. You could use a balloon loan if you wanted your cash flow higher, didn’t plan on keeping the property or were going to refinance down the road with better terms.
In stocks there are several “loan” varieties too, you can leverage your holdings value via margin. So basically you get to invest the banks money and keep any profits you make. It varies by platform but basically if you have $10,000 of cash or holdings such as stocks, that would allow you to invest another $10,000. Definitely don’t do this until you fully understand investing or have a plan for it because you could lose the banks money. That being said, if you are a good investor with a track record and have a solid plan then this is an excellent tool to use that allows someone to accelerate their earning in their portfolio. If you are making 10%, 20%, or 30%+ you could utilize a portion of your margin $ to add to those earnings.
I’ll use Robinhood as an example. They recently raised their margin interest rates to 3% due to world economics and inflation, but that is still pretty low. That means if you are going to use any of that money your investments Must make more that 3% to cover the interest and anything above is take home for you. if you want to go to the next level Interactive Brokers has some of the lowest margin rates in the industry, as low as 0.75%. I can purchase dividend stocks that make 5,10,20% all day long thereby multiplying my income just from reliable dividend payments. I will try to put a referral link below if you want to check out either one and get some free stuff.
If you have built up your portfolio over time you could qualify for portfolio margin. Some platforms might allow you to leverage 2 times, 5 times, I have see 30 times. You really have to know what you are doing, and usually you need to have over $100,000+ in your account. Again though this allows you to multiple your gains and accelerate your reliable earnings. This is where people might get over confident and try riskier trades but if you are at this level hopefully you have learned your lessons. There is no greater lesson that losing $10,000 or $50,000 unless it’s more. You tend to not repeat those mistakes. I try to only use a small portion of available leverage to account for market fluctuations, don’t be the guy or gal betting everything on black and losing it only to have to start over. On the flip side some opportunities only come along once or twice in a lifetime and you need to be financially educated in order to recognize those instances. Once you see them, act, and act in a big way. The Dot com bubble up and bursting, iPhone, financial mortgage crisis, housing bubbles, world wide pandemic, electrification of society. These are instances when $ is made and made in a big, big way.
Time is always a factor in investments and life, you can never get time back. That is why I try to accelerate things as fast and safely as possible. #1 rule is dont lose money, if that happens it sets you back and slows the process down. Slow and steady, compounding gains, adding a little leverage can kick your tortoise into high gear.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
Prayers go out to people affected in the Ukraine today. 😢❤️🩹
World troubles mean the markets will be effected good and bad. Some stocks will go up while other will go down. If your holding the ones going down it can be very scary as well as the ones going up, what to do?
The stocks we are trading currently:
BAC – 1 day Put, will look at gain tomorrow
UNG – Rolling Calls – Energy and oil plays generally with shoot up with a Russian conflict.
INTC – Rolling Calls
TOL – Rolling Puts
TSLA – Rolling Puts
TUP – Calls in place
GOLD – Calls in place
QYLD – Holding, acquiring more
SLVO – Holding
I just wanted to throw out some stock info real quick for encouragement. When the markets take big hits or go down, this is the time to invest. This is when things get scary and people run, this is also when money is made. Never invest what you cannot afford to lose because it isn’t about getting rich quick. The market may keep going down for awhile, but I will be investing the whole time. When it comes back is when you feel good about your decision.
This weekend I may do a post on leverage if anyone is interested. One thing I was told never to do was leverage my money. I was also told to never invest borrowed money. Two big NOs that I threw out the window.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
As I’m finishing up the week from meeting with other investors I wanted to throw a couple thoughts down on the paper/screen. the best thing about meeting with people smarter than you is it is a hotbed for ideas and it gets your mind thinking, the wheels spinning.
While I’m concentrating on learning all I can on trading options and stocks, investing in real estate, dabbling in crypto currencies and other businesses. The one thing that is always in the background on auto pilot is our dividend stock portfolio.
I have a good amount of cash in dividend stocks, enough to provide several thousand dollars of income for us. Worse case if other things didn’t work out we could live off that income. One of my favorites is QYLD that has been steady, even through troubles in the world never cutting its dividend. Another one I like is SLVO which is highly, highly variable but a cheap stock to get into. Between the two we get 10-20% dividends on our holdings for the year paid out monthly which makes for a nice reliable paycheck to make a house or car payment, even the grocery bill.
Now some of the online brokers offer some very competitive rates on margin loans. Say around 2.5% on Robin Hood at the time of this writing to even cheaper rates on Interactive brokers. So just thinking in my head which can be a bit jumbled at times, with an example account the size of $100,000 you could easily earn over $10,000 in dividends a year. Now with a 2% margin loan you would pay $2,000 interest on a loan of $100,000. This would double your buying power to $200,000 thus doubling your dividend income to over $20,000. After paying for your interest on your loan, your income would be at least $18,000. That is only thinking small though, imagine more leverage like 2, 3, or 10 versus a one to one margin. What if you add a zero to the math and invest more, the possibilities just grow from there. We didn’t even mention automatically rolling the dividends into purchasing more stock thus compounding the dividend growth…
As always do your own research and utilize margin or debt very carefully. After all, it’s one of the things I was told never to do!
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
I was in one of my mastermind groups discussing wealth, trusts and how assets are structured. I was thinking I have written something about this topic, so I went back and found a family email I wrote but it wasn’t anywhere online… Well, copy, paste, here it is from 2021, enjoy:
Every few years reporters come out with another big story on how rich people are avoiding, manipulating, hiding, storing money or not paying taxes etc… The Paradise papers, Panama papers and now the Pandora papers. They make headlines for a few days, how horrible it is for these politicians and wealthy people to avoid what the everyday joe pays, then it disappears for a year or two. Everyone scoffs and say that’s a shame and go about their business. Why don’t these people go to jail or pay fines for their crimes? Because 99% of what they are doing is totally legal and what they are doing is very smart. It is called good business to save money. Just like the everyday person uses a coupon or shops at a store when there is a sale, they are saving money. They just know how to do it much better than you and on a vast scale that most people cannot and will never even try to comprehend. The news loves to report on bad things to grab your attention. People love to complain and point fingers, it’s just in their nature or maybe how they are raised, the people they are around or exposed to? Blame the other guy for your problems but they just keep going about their days doing the same thing over and over every day. Can you do what these billionaires do? Maybe not right now but you can learn from them and instead of pointing your fingers, maybe take some notes. Every time I talk about business, people say but you have to pay taxes on that. Oh, all your profits will be gone with taxes, it’s just not worth the effort. I just smile and laugh to my-self, would you rather pay 0 taxes on your 0 dollars or taxes on your $100,000 dollars? Haha, I just don’t understand the thinking so if you can explain it to me, please do. I’ll gladly pay taxes on $10,000 , $100,000 or even a million dollars. The entire IRS tax code is an instruction manual on how to save money! Most people see it as this bad thing they have to pay but that’s just not the case. Don’t be the guy pointing his finger, everything in America was built on small business, including the tax code. Why is everyone trying to fight it? George Washington ran a small whiskey business, Thomas Jefferson practiced law, Abraham Lincoln had a general store, Andrew Johnson had a tailor shop, Truman had a clothes store. From the founding fathers to modern day, many politicians have had small businesses. The people who write the laws and run the country are businessmen and women. You don’t have to have a gigantic corporation, a six-figure income, be a stock trader or even have a goal of being wealthy to use the rules that are in front of you. I just ask that you try to see it from a different angle and maybe you might want to step out of your comfort zone and participate. I can show or point you to others, that can show you how these rules benefit you. How you don’t have to just be part of the crowd pointing, up to you. It’s always up to you.
Want to go deeper down the rabbit hole?
Here is one small thing the Pandora papers teach us:
At the base is the LLC, we could use it for a small business, if that business grows to say $50k we could incorporate or form a corporation and draw a salary. A good business accountant knows all the rules. I included a link to Mark Kohler’s practice below. In the Real-estate case an LLC can hold several properties say 3 or 4, then another LLC is formed. This is for several purposes.
Lawsuits – If something does happen and a lawsuit is filed, say property ‘A’ didn’t maintain the sidewalks and someone falls and gets hurt. The LLC holding that property would be responsible for the damages and only that company. Not the other 5 LLCs we have holding property. Not our personal bank account that we buy groceries with. We don’t get touched by it.
The corporate veil – if done properly your name is not associated with the property, it is owned by a company etc., so you are not involved personally.
This is easy we can do this! The pandora papers take it to a whole new level. So, if the companies on the bottom have contact with the public. Say a storefront, real estate office or even a Law-firm. That is where any lawsuits would happen. That’s all that company is responsible for. They don’t own the building or Real-estate etc. in the illustration we can use assets like factories, houses or cars. These are held by the Holding company. Its whole purpose is to hold things. The holding company has hard assets and even other companies under its name. It never talks to the public though, so is more protected from litigation etc. The level above that is your trust. Your trust owns the holding companies that in turn owns hard assets and other companies… The trust may control the purse strings. Where the holding company just holds assets. The proceeds are fed to the trust so it can hold the money… make sense so far? The trust is also like the instructions for the whole system, it dictates what the companies do, and it controls where the money goes. It is like a living entity; businesses are referred to as people in practice since they take the place of a living person.
The trust is protected again at another level.
It doesn’t deal with the public
It’s doesn’t own the large assets directly
Doesn’t deal with payroll, healthcare or HR issues.
The trust is controlled by the trustee. This person or persons i.e. board would dictate the rules and make changes as needed.
On top is the beneficiaries, what are they for? What do they do? In reality they don’t have to do anything. They may make withdrawals from the trust or take a form of a paycheck. They may be investing money into the trust in the form of assets, money, life insurance. They might live in a house owned by the trust or drive a car owned by a holding company. They may actually be a trustee! In reality if done properly the beneficiary at the top would own nothing, not a car, bank account, or even the clothes they wear. They are just a beneficiary of the trust, subject to the rules dictated to them, living their lives but and this is a big but. They control everything.
The object is not to have the most wealth, fancy cars or house. The object is to control it.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
Invest in companies you: understand, believe in, have good financials.
You don’t lose money until you sell your assets.
So, the markets are dropping, dropping and dropping. If you have the knowledge, understand trends, you will not have as much fear, after all everything goes through cycles.
How’s that going for you? Well, the portfolio is down 10-20% (Scary stuff) but still making money every week. If we had more capital available, we would be investing more, and we are making more capital available as we speak.
TSLA – Down
Long-term hold
If I had the capital I would sell Puts for amazing premium.
NIO – Down
Long term hold
Selling Puts – Dollar cost averaging position lower
Selling Calls
UNG – Down
Selling Puts – Dollar cost averaging position lower
Selling Calls
TUP – Down
Holding – Dropped too much, bad earnings report, do not want to invest more.
Selling Calls out of the money – This lowers basis and break-even point.
ARKF – Down
Holding
Selling Calls out of the money
Last week we made several thousand dollars as the markets declined. This week is just beginning and we have made a few hundred and counting. By utilizing Options/Stocks when the markets drop everything is on sale. When everyone is scared and selling the volatility goes up and you make more premium on the option contracts. So, you make money on the way up, you make money on the way down.
Where do we get more capital? Real Estate. They just don’t make any more land and it has been appreciating through the roof. Selling low-cost assets purchased years ago we can now take that appreciation of 100+ % and shift it into higher end real estate that will have even better appreciation in the coming years and the dropping stock market. You buy low and sell high, unlike the majority of people who get scared and sell low when the bottom is dropping, only to watch it go back up and jump back in at the top again. You have to do your due diligence and only invest in things you know, not your neighbors’ hot stock pick.
You cannot say enough about real-estate. To buy a $70,000 property for $20,000 down, have someone else pay the mortgage, taxes, interest, expenses for several years then sell it for $150,000. So, while the stocks are going down, the real estate is going up. Maybe next time I’ll write about the house I bought for $5,000 that I still own. Spoiler – Zillow says it’s worth $138,000. Not bad real-estate, not bad at all, I think I’ll keep investing.
Meanwhile the dividend stocks sit in the corner ignored, appreciating, buying more and putting cash in the account. I own and have owned a variety of stocks over the years, but QYLD is becoming one of my favorites. Month after month it works for us providing paycheck after paycheck.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
I choose to have multiple streams of income that are reliable and fairly steady. Real estate, stock dividends, stock trading, Crypto investing. Crypto investing can take on many forms such as just buying and holding the coins, trading the coins similar to the stock market, staking the coins. One unique feature of the crypto field is Mining.
Info on Crypto mining – Like anything do your due diligence. This is called GPU mining. To build something like this, you need to be a little techie and have electrical knowledge or know people who do. I know a lawyer who had his I.T. guy put it together for him. This is running on a dedicated plug in my garage with a 30amp breaker. It pulls 1100-1300 watts continuously. It would be fine on a 20 amp circuit if you weren’t using anything else. In the colder climates you can use this to heat a room or your house etc… I had it in my office, building and testing it. The room was a good 15 degrees warmer than the rest of the house. Depending on the price of crypto which is down quite a bit rt now, this will make around $$17-20 a day. Parts were around $6000. 100% return on your money maybe 300 days, 9-10 months. This is an infinite return: After an investment pays for itself, then it just prints money afterwards. You are not getting 10, 20, 30% return. After you have gotten 100%, the rest is just extra, infinite….. I love these types of investments. Hardest part is taking that step versus researching/debating for another month…
If you don’t have the time or skills for that. If you have a nice computer or the kids have a tricked out gaming pc you can make a couple dollars a day which adds up. You can use the website NiceHash to see if your computer can make anything for you instead of just sitting there. I bought a new graphics card on eBay and my office pc makes $4 a day now. $28 week, $121 month $1460 year.
There is a whole different topic on ASIC miners – these are industrial machines that I don’t even want in my house because of the energy usage and how loud they are. These machines can cost anywhere from $10,000 to over $75,000 but you can ship them to someone to setup and host it for you. i.e. making $20-250 a day. They do the maintenance and pay for electricity and in return skim money off your profits.
Building something like this might cost $5000, you can cut corners and make this for $3000 or less. The main cost is the GPU cards. Just as the stock market goes up and down so does everything else. In the next down trend, you may be able to pick up parts a lot cheaper than now, they are marking parts up two to three times.
If something is profitable, what price are you willing to pay?
Would you pay a $1 to make $10?
Would you pay $10 to make $11?
Would you pay $10 to make a 1$?
This is where people start to baulk because they don’t understand the math, want to get rich quick and when you add zeros it gets too scary. Spending ten dollars to make a dollar is a ten percent return and if you can make that in a few months that’s pretty good. People would repeat that over and over, but this pays for itself and is an infinite return. Do you see the beauty? My investment makes 100% returns in a year and is now just making me money streaming into my bank account.
Add the zeros and people go crazy, invest $10,000 and I only get $1000 back? Invest $100,000 and I’m getting $10,000 every month.
Sign me up for that, you just built yourself a robot employee, welcome to the future.
What’s happens when your assets start buying you more assets? That snowball is starting to get bigger: Real estate, Dividend stocks, crypto mining. When your money is doing all the work for you it is a beautiful thing, Let’s revisit the mining rig 6 months later:
Now on a bad day we are making $50 a day, $16,000 to $20,000+ a year. The crypto Mining space is ever changing like any investment so we will see how this asset performs this year. Whether we need to invest more into it or just take the profits.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
December has been a slow month with the holidays upon us and relatives visiting. I’m thankful for having the time to just take off and enjoy it with family and friends without worring about a hourly job or calculating vacation time needed here and there.
Real Estate has continued to be extremely lucrative, with such a high appreciation in the market we are continuing to sell off some Indiana holdings.
An example – A condo purchased for $97K in 2016 will be listed at $185k in 2021. Real estate in America is one of the rare places in the world where you can buy a property through a bank loan and rent it for more that the mortgage payment. At first glance you might think 185-97=88 so a profit of $88k almost a 100% gain? But we only need 20-30% down to buy a property, so in this instance $29k down. Currently the mortgage balance is at $77k so after the sale not taking into account fees and such 185-77= 108. So we invest about $30k and get a return of $108k, that is not a bad deal. I’d take that everyday, 360% return? Many investors would use a 1031 exchange where the profits are rolled into a purchase of another property thus avoiding taxes. If you could buy this property for $30k what could you afford for $100k down? What would your monthly income or cash flow be then?
On this condo with a mortgage payment of $700, plus insurance, HOA fees, etc.. still leaves for a nice profit at a monthly rent of $1400. If you could keep acquiring these you could easily replace a 6 figure income in a very short time with just a little effort and determination.
December is typically slow in the stock market with people on vacation. The markets require people after all to make moves. A little sell off this month with worries in the market surrounding the Fed announcements and new virus concerns. We are hoping for a nice pop back up the last week, sometimes called a Santa Claus rally.
Some of our current positions that are being actively traded utilizing options are UNG, TSLA, ARKF, NIO, TUP. Some of our larger dividend holdings are in QYLD and SLVO as well as a large assortment of high dividend yielding stocks.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
I started with real estate by listening to podcasts and reading books. Gathering knowledge, everyone around me had said it was too risky, trouble, too hard, you will lose everything, your basic doom and gloom. I gathered my own knowledge to evaluate those statements from friends and family.
You are who you associate with, so if you just listen to everyone around you then you inevitably will become them. You know what I found out? Once I purchased my first property it went from no one around me knew anything about Realestate to oh I own a rental, I own a condo, I own an apartment building. When everyone around me was predicting failure and I was contemplating these decisions, there were people that never said anything. They were silenced by the doom sayers, the negativity, once I started my own ventures and learning, people started coming out of the woodwork around me, everyone had a property or two! …. What the heck… I started associating with different people.
Where did I start? I started with single family homes but there are many routes to take, depending on you and what you like, what are you comfortable with. I always thought, You shouldn’t go to bed worried about things so find your comfort level with investing. Norada has everything to start, when I first found them, I think there were 3-5 of the best markets, now they have expanded across the country. They evaluate the best areas to own rental properties.
Marco has everything: info, podcasts and counselors to help you through your first investment.
This material has been distributed for informational and educational purposes only, and is not intended as investment, legal, accounting, or tax advice. Investing involves risk.
Cash Flow is this Easy 