Investing For Extra Income
The stock market can be a good way to make some extra cash flow off of your investments. There are basically 5 ways to get consistent cash flow from the stock market.
1. Dividends
Buying high dividend paying stocks is the easiest way to make extra money trading stocks. When you buy a dividend stock you are recieving your share of the companies profits. All you have to do is to hold onto the stock and you continue to get paid.
2. Covered Calls
Covered call writing is another way investors can make money from a stock that they own. Basically when you write a covered call you sell someone else the right to buy a stock that you already own at a given price. By buying a stock and selling calls on it every month you can make some extra cash flow.
You may be forced to sell the stock at some point in the future, but it can still be a pretty powerful way to make some cash flow.
3. Option Selling
There are many different varieties of spreads out there that allow you to profit as a stock stays above or below a certain level. Taking advantage of those strategies can lead to a relatively consistent income.
4. Option Buying
Option buying can also be a pretty powerful way of making money. If you get good at picking great stocks you can make money by buying options and selling them for more. The huge potential of this strategy makes it the most profitable way of trading in the stock market, if you can master it.
5. Day trading
Day trading and swing trading both attempt to make money in short term movements in the market. Over time the profits add up and can even create a livable income. But it does take time to master.
