Covered Call Philosophy|
by Graham J OConnor
Most people are aware that the stock market can either
be a "Bear" or a "Bull" market, but few are aware that
there is another scenario, that of the "COW" market.
The objective of our manual is to teach the reader how
to "milk" that COW market for consistent monthly returns.
While the Bears and the Bulls are guessing whether the
market is heading up or down, we KNOW it is going to GO UP
AND DOWN and we make money in either direction, compounding
the earnings as we go.
We are concerned with the underlying equity, i.e. it has to
be a sound stock that is not going to go out of business.
However we are not duly concerned with the underlying price
of that equity. We will just keep "milking" it to produce
consistent monthly returns.
The old mindset of, "buy high sell low" is fundamentally
flawed. If a $20.00 stock has dropped to $17.00 have you
made a loss? The answer has to be NO, not until you realise
that loss by selling it. If you don't sell it and continue
to let it generate monthly cash income, how have you lost?
Look at it this way, if you bought a rental property for
$200,000 and rented it out for $2000 per month in 100
months (8 years, 4months) you would have recouped your
investment and still own the property. Now at some point
during those 8 years, the property may have gone down in
value to say $180,000, would you have sold it? Of course
not, you would have continued to rent it out and said to
yourself "No problem, it'll come back" and you would be
correct in your thinking.
In the above scenario your investment may have gone through
a period of negative equity, but who cares, keep taking the
rental income and wait for the market to pick up. This is
how we can "milk" the COW market. It just happens a lot
quicker with stocks and The Market Milker System~ manual
will show you how.
This article courtesy of http://www.investment-index.com.
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