I'd start with "The Simple Path to Wealth" by JL Collins. It's a great read and I highly recommend the strategy. Personally, I trade with Ally, Fidelity, and Vanguard.

 

By "trade" do you mean day trade? Can we even do that with Fidelity?

As an aside, I'm disappointed we can't buy digital currency in our Fidelity accounts.

 

Yes you can day trade at Fidelity. You can also do options and leveraged ETF’s

 

If you want some exposure to bitcoin and others, look into GBTC. It’s a bitcoin investment trust. I owned it in my Fidelity brokeragelink account. Sadly I missed this run up. I sold it several months ago but did own it during the previous run up.

 

The only options you can trade are covered calls. I wish they’d allow us to trade “cash secured naked puts”.

Let’s say you want to own FB (Facebook) stock, but because it’s been on a good run, you don’t want to buy it at $271 a share, but at $230 or $250, you’d love to own it. As long as you have $23000 ($230x100 shares) or $25000 available ($250x100 shares) you could sell a FB $250 put option today and collect the premium. If FB drops to $250, your put option gets exercised and you’re the happy owner of FB stock at the price you wanted. If FB doesn’t drop to $250, the option expires worthless and you keep the premium. You do that every month, and continue collecting the premium until the stock drops to the level you want to buy it at, in the mean time, you’re making money on FB without even owning it. It’s a pretty riskless strategy that even Warren Buffett uses to not only get a great price on good stocks he wants to own, but to make money off those stocks while he’s waiting for his price.

I get that it’s not for everyone, but I’d be using this strategy in my 401K a lot if it was available to us.

Edit: I should say it is a pretty riskless strategy, as long as you do, in fact, want to own that particular stock.

Right now, the January 15 $250 put is trading at $460
$230 put is $182

The December options don’t expire till next week so this isn’t a great comparison because if you did it every month you wouldn’t quite get those prices because you’d have to wait until your option expired next week until you sold another option, Unless you had another $25K laying around, so let’s say you could get $380. You’d be making $380 a month on your $25K cash position. You’d earn $4560 in a year (assuming FB stock didn’t move and you kept your $250 price. $4560/$25000= .1824 or 18.24% return. If FB goes up, you wouldn’t collect the same premium every month but you could adjust your option to one closer to the money.

 

The two strategies have nearly identical outcomes. There may be some limited arbitrage opportunity, but traders keep the options premiums very close. The commission efficiency by writing out of the money naked puts (one option sale) vs in the money covered calls (buy stock, sell call, sell stock) may give you a slight edge. The interest earned by keeping cash in your account vs buying the stock is negligible at today's interest rates. The opposite is true if you are looking at out of the money covered calls vs in the money puts when looking at trading cost efficiency.

I too wish we could sell cash secured naked puts.

 

Thanks.

Niall Ferguson recently recommended Bitcoin in Barron's. Even though it's up and likely to tank again, with each run it bottoms out higher and higher. I intend to buy and hold.

 

I'd expect more of this from HOA's.

People who buy homes in their neighborhoods, who pay $$$ into their HOA's for amenities, didn't do it so 10% of the owners can run a time share on the backs of everyone else. It's monetizing the community capital of the many for the sake of the few.

Yeah, "It's 'muh property, I can do what I want with it"...I get it. Zoning laws exist for a reason, and there's a good chance your property isn't zoned for an unlicensed hotel/short term rental which isn't properly insured for fires, escape routes, transient traffic, any personal injuries that occur when you submit a claim and your insurance company realizes your "guests" were short term renters, etc. There's an outside risk enforcement might come a-knock'n, depending on the neighborhood, and shutting your down, hard.

Some exceptions, of course (beach front comes to mind..in a certain price range, they're pretty much all rented and everyone knows it).

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Specific suggestions if you go down this road:

1. Leave extra batteries. There's a reason hotels make their TV remotes darn near unopenable.
2. Cameras. Cameras in non-private areas (no bathrooms, bedrooms) are allowed if disclosed upfront. Have a friend who's >$1 million property was trashed by a AirBnB renter who sent their teenager (and many, many friends) up to have a LAN gaming party. They couldn't prove it, and had to pay a bunch out of pocket -- quickly, because more "guests" were coming.
3. Hot tubs are a nice amenity. Try not to think about what's going on in them.
4. An "owners closet" that's really secure is a good idea.

 

You don't have to let the options expire before entering another trade. You can buy your puts back at a profit.

 

Options trading is a great side hustle, but definitely not for everyone.

There are lot of misconceptions out there about the risk/reward of options, and I don’t believe (if you’re serious about it) you should attempt to dispel those myths on an airline pilot forum.

My recommendation, if anyone is serious about options trading, is to start learning the tastytrade methodology. It’s a probability based method that requires you trade small and often. It’s commissions are capped at $1 to open (per contract) and $0 to close. Their platform is top notch, uptime far exceeds think or swim, interactive brokers and fidelity (I’ve used them all). Tastyworks is everything you could want for trading.

Best of all, their programming is head and shoulders better than the crap you see on CNBC. It’s educational and entertaining. They’re underdogs in options trading but they blow the competition away in every aspect. Their favorite customer are the small fish like us.

If you want to trade options with fidelity you can, you can open a margin account, but be warned their desktop platform sucks and trading via the web interface is clunky and annoyingly difficult.

Always happy to discuss options and creating your own wealth through investing be it with options or straight equities. Don’t leave it to “the experts”. You’ll probably do “ok” but it may not create the generational wealth you have in mind, if that’s a goal of yours.

EDIT;

tastyworks is the platform www.tastyworks.com
tastytrade is their “media” and education network www.tastytrade.com