What 99% Of Income Investors Are Doing Wrong
Right now, we’re facing one of the most challenging environments for income investors in history.
#-ad_banner-#The average one-year CD yields just 0.28%. Yields on 20-year Treasuries have dipped below 2.5%. Even so-called high-yield “junk” bonds are paying just 6% — a far cry from what they once paid.
Stocks aren’t much better, either. The average yield in the S&P 500 is only 1.9%.
With rates like that, it would take you nearly 40 years to double your money, after accounting for inflation.
And that’s only if the market doesn’t fall, which is never a guarantee.
Of the 13,980 stocks listed on U.S. exchanges, a mere 166 yield 10% or above. And most of them are companies like Seadrill (NYSE: SDRL), which cut its dividend in 2012 and is down nearly 75% over the past 12 months.
Don’t get me wrong. I’m not against dividends, CDs and the like. You’d probably be wise to have some money in them. I’m simply pointing out that market conditions have made it very difficult to produce sufficient income from these investments alone.
Yet 99% of investors still choose to generate their monthly income from dividend stocks and bonds alone. Sure, it’s a safe play, but with yields where they are, those investors are settling for very limited income streams.
That’s why I’m among the 1% of investors who use this alternate strategy to generate more income — without extra risk.
As I’ll show in a moment, my approach can pay you on a weekly basis. You can collect your payments every Thursday — including this upcoming Thursday — and you don’t have to lock yourself into an investment for the long haul.
For example, look at a trade I made on PetSmart, Inc. (Nasdaq: PETM).
You’re probably familiar with PetSmart. It’s one of the dominant players in the growing pet food space.
The company owns more than 1,300 stores in the United States, Canada and Puerto Rico. In addition to offering supplies like food and accessories, every store includes a pet grooming facility and 200 locations offer boarding and personalized care for dogs and cats.
When I spotted PetSmart at the start of 2013, it had been growing revenue for 20-straight years. It was essentially a “can’t miss” investment. Had you simply purchased the stock, then you would have made 18% gains over the past two years, and you’d currently be receiving a dividend of $0.78 a share, or a mere 0.9% yield.
But what 99% of investors don’t realize is that you could have taken a slightly different approach with PetSmart — one that delivered a 6.7% return in just 37 days — good for a 65% annualized gain.
You see, I recommended investors execute a simple trade with PetSmart… and just like that, they could have instantly pocketed $240. The best part is you too could have done this without ever having to buy a single share of the company.
This $240 wasn’t a quarterly dividend. Nor was it some sort of one-time distribution like a special dividend. It was something else entirely… a strategy that most investors never take advantage of.
For example, this strategy would have earned investors a quick $300 from Tesoro Corp. (NYSE: TSO) — the second largest independent oil refiner in the country.
Or take Humana, Inc. (NYSE: HUM), the second largest provider of Medicare benefits in America. Investors who followed my recommendation pocketed $300 in income, instantly.
In my premium newsletter, Income Trader, I’ve made money on all 85 of my closed trades using this unique system.
As I mentioned, only 1% of investors even know about this powerful strategy. But like me, they too have grown tired of waiting around for quarterly dividend checks.
Since I started telling my readers about this strategy, many have pocketed hundreds, even thousands of dollars.
So how exactly does it work?
I sell put options to earn instant income from solid companies. When I do this, one of two things can happen: I simply collect instant income and the options expire worthless (which is a good thing), or I get the opportunity to buy shares of undervalued companies that I wouldn’t mind owning.
Either way, it’s usually a win-win.
I’ll admit my strategy is unique, but when you follow my advice, you don’t have to settle for low-yielding stocks or slow-moving bonds. And the best part about it is that it’s not complicated. In fact, it’s remarkably easy.
Unfortunately, I don’t have time to give you all the details about this strategy right now. That’s why I’ve prepared a brief 8-minute webinar showing exactly how my system works and how it can help you start collecting hundreds, even thousands of dollars as early as this coming Thursday. I urge you to check it out, here.