How to Use Naked Puts to Earn Income and Buy Overvalued Stocks
In this clip from episode 13 of the LEO Roundtable, we talked about selling naked puts in order to buy a stock that you think is overvalued, but one that you also want to own in the future. This practical guide is something that I think many people can benefit from.
As I continuously monitor the stock prices, I’ve grown intimate with how the stocks tend to move — their volatility, general reaction to various trends in the market, etc.
Obviously, I can’t predict the future. Just like everyone else (except maybe the Fed), I don’t have a crystal ball or a magic button that can tell me what a stock will be worth tomorrow.
So when stocks are trading above their fair value — which I believe to be the case for stocks on my personal watchlist like SQ and TSLA — what can we do to stay engaged with the stock price? What strategies can we deploy to earn income while we wait for our buying opportunity?
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