September 23rd, 2010 at 06:01 am
For some reason, I found this article interesting
, not so much because they are women (though more power to you ladies), but because of the wide variety of pursuits that lead to their wealth. I mean, think about it:
One of them runs a day time talk show.
One of them opened a bunch of clothing stores.
One of them is a real estate developer in China.
One of them is in marketing for a hugely successful dot com.
One of them is an author of a highly popular book series.
So, let's deconstruct this down one more step and examine their activities. What do they actually DO to make their billions?
One of them hosts a television show.
One of them sell clothes.
One of them develop real estate.
One of them does marketing for a website.
One of them write.
Let's go down one more step to the quintessential activity:
Broken down to this level, I think there's an emerging common theme. Basically, you want to connect and sell products and services to a large group of people. Connect and sell.
So, how does any of that translate to me? Sadly, I'm not a great communicator I don't think. And yet, I would like to think that this blog, for example, has a pretty decent reach as far as personal blogs go. So, some way, some how, even a guy like me can "connect" if I persist long enough....
But what about the sell part? I guess that's my biggest stumbling block. I have no idea what I could or would even want to offer to the general populace. The advice not to trade stocks?
I have no idea.
Well, it's amusing to contemplate anyways. What do you think? Either way, hope you enjoyed the article.
September 21st, 2010 at 08:27 am
I've been dragging my lazy feet canceling my home DSL, but partly because I wanted to make sure this 4G hot spot idea I've blogged about was going to work.
Good news! So far so good. Luckily, my coverage at home is OK, even if the speed is not as fast or reliable as DSL. And anyway, it's also $10 a month cheaper.
On the go, my coverage is, well, honestly it's spotty. However, the fact that I can even get 4G internet on the go is just gravy, and I am also doing it without having a cellphone bill.
And with that, I finally canceled my home DSL. I love lowering my monthly bills!
September 20th, 2010 at 08:45 am
Today is the day my option contracts expire, and I can write more.
Again, my entire trading strategy right now is that I have no idea what the market is going to do for the next month, so I might as well be a vendor and just sell contracts instead of attempting to speculate in the market.
However, that is not to say that being a seller is dull, and I walked away with some interesting observations from the past 30 days.
First, there was a stock position that did very well, and that got Assigned at the last minute (that is, I had to sell my stocks to him at our agreed price). Congrats to whoever it is for your huge relative gains. In any case, now I know what it looks like when my stocks have been sold.
Second, there was another stock position that was essentially flat. In this case, the covered calls worked out perfectly, because I already made money on a flat-performing stock. Not surprisingly, it did not get Assigned so I get to sell some more contracts on it.
My third and final stock position was absolutely atrocious. Atrocious! Even so, I can still write contracts on them, albeit for a lower premium. Despite the paper drop, I am surprised that I can still squeeze out $200 this month on this position!
In all, I'm very pleased with this type of trading, even though, yes, it's still chock full of risks. Again though, I'm in no rush, so baby steps still.
September 15th, 2010 at 06:47 pm
I think I may have blogged about this in the past, but basically, there's this guy who has built himself a floating island out of discarded plastic bottles.Check it out!
I've stumbled across a more recent video of him, this time in much more detail, and it appears that he's made some major additions since I last saw it!
September 13th, 2010 at 12:24 pm
Here's an interesting article on the origins of common financial sayings
September 13th, 2010 at 07:47 am
In a typical household, it's normal to have a landline phone, cellphones, cable, and internet.
For some time now, I've managed to consolidate all of my phone needs into one Tracfone, for an average of about $5 a month. I've been very happy with that, and for some time now, I've been looking for ways to do the same with my internet.
Unfortunately, while I rarely use a phone at all, I am a complete internet junkie. In my own defense however, I do not have cable or even Netflix. So, my only source of entertainment centers around being online somehow.
Recently, I've been experimenting with a mobile 4G hot spot device from clear.com. It is unlimited 4G data for $40 a month, my home and most areas near work have coverage, and the speeds can rival my DSL, which I am currently paying $50 a month. Best of all, because the device is portable, it means that my iPod Touch has data access similar to an iPhone, except with 4G speeds!
In other words, for the price of shaving $10 a month off my internet bill, I also gain mobility with it! A typical iPhone alone would cost a minimum of about $55 a month. Home broadband would be a separate bill. However, with this one device, I am able to do it all for just $40 a month! Combined with the Tracfone, all of my household bills are only $45 a month (not including gas, electric, and water bills).
There is one minor downside: I now carry three devices on my belt: The cellphone, iPod Touch, and now, the hot spot device. I feel like Batman.
September 10th, 2010 at 07:32 am
Stumbled across a really cool website about Want versus Need
September 8th, 2010 at 06:37 am
So, a friend of mine is really itching to get into stock trading. Even though he's in a lot of debt and being garnished by the IRS, he wants to use like $2000 of his student loan money (at more than 6% interest) for it.
I told him about the risks, but he was like, "It's worth it. Gotta start somewhere." But I'm like, "Are you sure about this? Because the numbers don't make any sense." His response was, "Numbers never make any sense BA! They're subject to interpretation!"
Oh really? Playing with the stock market using borrowed money you need to live off of within 3 to 6 months, and at 6% interest is somehow subjective? And why so defensive? I'm just trying to be a friend and warn him of the dangers involved.
You guys know that for literally years, all I did was pay off my student loans. No stock trading here. And even now, I do not trade on margin (loans) whereas that's exactly what he plans to do. Also, he needs this money within 3 to 6 months, whereas I don't trade with any money that I need anytime soon.
I mean, it's just such a bad idea that even I would not have done it. I do wonder why he is so dead set on it? Is it ego? I know he's used me before as a source of information, and then passed it off as his own to try to impress beer buddies and women with it.
I do have to admit that I am partially to blame. He's a friend that I've been talking about all my stock and options trading to. So, clearly, I embedded the idea in him somehow. BUT, I had no idea he would decide to be so reckless about it. That's the last thing you want to do because the activity itself is dangerous enough as it is.
But I guess what really bugged me about all this is that he was being rude to me about it, even though I'm just trying to help as a friend. Whatever. I didn't tell him all this though. Instead, I just said that if he feels that strongly about it, then just open a Scottrade account, and buy his stocks there.
I don't think I want to hang out with him for a while though. That and a lot of other stuff makes him really stressful for me to be around him.
September 1st, 2010 at 06:47 am
I just finished selling the last batch of call contracts available for me. After fees, it's another $280 I pocketed, pushing the income total up to above $1000. So, despite the fact that I'm a newbie in options trading, I think it's very realistic to generate $1000 a month in contract income this way.
Of course, risks and potential losses aside, most of this occur within my retirement accounts, so it's not like I can actually use it for anything.
I'm already fine-tuning the strategy as we speak, and I think I would like to get out of individual stocks completely. Maybe. The option is always there, of course, but I think I can use this strategy just fine with nothing but SPY (US stock market ETF). The volumes are gloriously high, and contract intervals are much shorter (which isn't necessary, but it does give me greater flexibility).
Yeah, in other words, I'm basically done trying to speculate on the market. I'll let others do that. I'm content with just being a "loan shark", and despite the name "options trading", holding SPY and selling contracts on them is actually very conservative and safe (as far as trading goes).
August 30th, 2010 at 10:49 am
This month's stock market has been tough. My stocks have slipped rather substantially at this point, so I guess it's good timing to make some income off of them.
With the market slip, I bought some more stock and sold more covered calls, pocketing another $380. I think the total of contract premiums I've made is up to... almost $800? They're all set to expire on September 18th, so I can sell another round of contracts then.
I've also been fine-tuning the strategy, to focus more on earning the premiums over trying to win the market somehow. Less speculation and more guaranteed income.
While covered calls still have the same downside risk as regular stocks, at least you're also propped up a bit with the contract income. The real downside, I think, is giving up on the upside potential. However, I don't see how this is a problem because, again, I'm trying to reduce speculation, and exchanging it for guaranteed income. Despite that, even covered calls have the ability to return 10% to 30% in annual gains, depending on your trading abilities and market conditions. Good enough for me.
I'm also reading up on cash-covered shorted puts. It's the cousin of covered calls where you sell put contracts (to buy their stocks at a set price), again, for a fee premium. But in theory, I could do absolutely nothing more than covered calls, and still do just fine. But adding more and more of these strategies ultimately gives me more trading flexibility, regardless of the market direction.
August 26th, 2010 at 03:28 pm
This doesn't have anything to do with finance, but I thought some of you might get a kick out of this flower breeding game
. There are no winning or losing with this game, just whatever you feel like doing. Enjoy.
August 26th, 2010 at 07:30 am
It's that time of the month again! My net worth posted a very modest increase this month. Only 1.33%. For a while, it was actually behind too.
What happened? The stock market hasn't been all that kind this month, and you know, I'm kind of amazed at just how much influence the stock market has on my net worth these days.
It got me wondering what my basic asset allocation is, and... it's 65% stocks/options, 35% cash/bonds. Hmm. I thought my asset allocation might be off somehow, but it's actually fairly on target. That percentage is also when I am bought into stocks. Otherwise, my cash/bonds percentage would be much higher.
So, despite my relatively risky hobby of stock trading, I don't feel like I am taking too much risks. When I do trade stocks, I typically stick with quality company names, and on top of that, now I am adding covered calls to sort of buffer against market volatility, and at the same time, converting the stocks to be more of a passive income generator. As far as stock trading goes, I'm actually very conservative.
Still though, the month has essentially been a disappointment... as the blog subtitle says, it could be worse. A lot worse! Gotta celebrate the little things in life.
August 25th, 2010 at 01:25 pm
Today's market started out rather low, and I decided to buy more SNDK, and then make some more covered calls with it.
You know, I really like this covered calls option. This way, you're not entirely at the mercy of the stock market. You make decent (immediate) income selling contracts that although locks you into a price you are obligated to sell, you are nevertheless selling at a profit. And you can also adjust how much passive income versus market volatility you want to depend on for your money.
For example, I just made an additional $200 (for a total of $300) just for selling contracts that, even if it's exercised, would allow me to sell my stocks at a pretty substantial profit (15%+).
Now you're probably saying, "Wait, where's the downside?" The downside is that you're still at the mercy of the stock market, and there is still a risk of losing money. There is also the "risk" of capping your gains, but I'm not greedy, and it's 15%+ profit. The real risk is that your stocks can still lose a lot of value, to a point that it erases both the market value as well as contract premiums that you make.
But hey, nobody said this was a free lunch. I mean if I want a lot more guarantee, then I might as well buy bonds instead.
Believe it or not, but covered calls actually cushions me from a straight up stock trade. Geez, I don't know why I haven't done this sooner.