How to maximize idle cash? STUDENT INQUIRY FOR HER THESIS
First, ask your brokerage firm about the mutual funds or cash-management accounts it offers with the highest yields that can be used as collateral for the sale of cash-secured puts. (Many firms automatically put clients in cash-management accounts that pay the least amount of money.)

Once that critical detail is handled, you can identify stable stocks with solid dividends and attractive options premiums that you would like to own. You want to get paid for the risk of selling puts, which increase in value when the underlying stock price declines. A good starter list of potential stocks includes (ticker: AMZN), Apple (AAPL), BlackRock (BLK), Microsoft (MSFT), and AT&T (T).

Next, focus on puts with strike prices that are 5% to 10% below the stock price. Some investors like selling puts that expire in three to six months to maximize their money received. Others like to focus on puts that expire in a week to maximize the impact of “time decay.” This simply means that as each day passes, the options contract loses more of its value.

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RE: How to maximize idle cash? STUDENT INQUIRY FOR HER THESIS - by Pureblade - 11-02-2019, 08:29 PM

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