{"id":1821,"date":"2010-01-09T17:23:28","date_gmt":"2010-01-09T11:53:28","guid":{"rendered":"http:\/\/www.niftylivecharts.com\/blog\/?p=1821"},"modified":"2010-01-09T17:23:28","modified_gmt":"2010-01-09T11:53:28","slug":"covered-calls-vs-dividends","status":"publish","type":"post","link":"https:\/\/www.niftylivecharts.com\/blog\/covered-calls-vs-dividends\/","title":{"rendered":"Covered calls VS Dividends"},"content":{"rendered":"

There are 2 great ways to pull out monthly income from the stocks you own. \u00a0These are covered calls and dividends.. \u00a0If you are going to hold a stock for a long period of time you would like to be pulling money from your stock both ways.<\/p>\n

If you can\u2019t pull out money both ways which way would be considered the better income? Let\u2019s look at that for a second.<\/div>\n
A dividend is when the companies pay you out money for owning their stock. \u00a0They are relatively \u00a0easy to obtain. \u00a0 The only thing you have to do is buy a stock that has dividends. \u00a0The only problem with this is that in order to make a good income out of dividends you need to have a huge account.<\/div>\n
Covered calls take a little more effort. \u00a0Your money comes from other investors who are willing to buy your stock at a certain strike price in the future. \u00a0 For this right they pay you a premium. \u00a0 This can be a little trickier because you want to sell a strike price that you do not believe your stock will reach by expiration, but close enough to the stock\u2019s price that you will get a good premium.<\/div>\n
Some traders who do not care about the long term growth of their stock may actually choose to sell a strike price that they believe a stock will be at by expiration. \u00a0This way they can pull out a profit from the premium and a profit from the stock.<\/div>\n
This can be worth the extra effort. \u00a0Between the two covered calls have a higher return rate. \u00a0Where as a dividend may pay you 3-5% annually a covered call may pay you 3-5% monthly.<\/div>\n
Many traders will prefer to trade covered calls because they are relatively consistent. \u00a0Like dividends Covered calls can bring monthly cash flow on a consistent rate if you do them right.<\/div>\n","protected":false},"excerpt":{"rendered":"

There are 2 great ways to pull out monthly income from the stocks you own. \u00a0These are covered calls and dividends.. \u00a0If you are going to hold a stock for a long period of time you would like to be pulling money from your stock both ways. If you can\u2019t pull out money both ways […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[1],"tags":[3003,2453,2901,504,917,2536,5197],"class_list":{"0":"post-1821","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-general","7":"tag-covered-calls","8":"tag-dividends","9":"tag-stock","10":"tag-stock-dividends","11":"tag-stocks","12":"tag-trading","13":"tag-utures-and-options","14":"entry"},"_links":{"self":[{"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/posts\/1821","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/comments?post=1821"}],"version-history":[{"count":0,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/posts\/1821\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/media?parent=1821"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/categories?post=1821"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/tags?post=1821"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}