Famous Option Sellers Who Stepped Out of Their Comfort Zones
Is staying locked in your comfort zone keeping you from higher returns?
Earlier this week on this blog, we covered Robert Kiyosaki Rich Dad, Poor Dad disciple Andy Tanner and his book “Stock Market Cash Flow.” In it, Tanner reveals the Rich Dad sign of a “true investor” as “having the ability to maintain or even increase cash flow even when the markets or the economy are falling.”
Tanner goes on to describe option selling as a primary means of accomplishing this.
For those that doubt the soundness of Tanners’ ideas, I recommend reading page 220, under “How Warren Buffet Generates Huge Profits with Options.” Hint, he’s not chasing “Alphabet” higher. He’s writing options.
I’ve written about this in the past. Buffet, Carl Ichan, Jim Rogers. Everybody wants to know the next hot market these big shooters like. Few will dig deeper to see how they are generating the cashflow to really boost their returns. They write premium. They, as great of stock pickers as they are, at one point, stepped out of their comfort zones. Because they knew that to grow a portfolio over the long haul, staying in a comfort zone would be riskier than exploring new frontiers. It is also my contention that they, to some degree, also subscribe to Kiyosaki’s and Tanner’s definition of “true investor.”
Guess who turned out to be an option seller all along? But even The Oracle himself had to step outside of his comfort zone at one point and explore a new strategy.
Where do you find yourself in 2017? Are you stuck in a comfort zone, doomed to live and die with the whims of the S&P? I hope Trump does take the economy on a thrill ride and I hope the Fed does the right thing with rates. Does that mean I’m willing to bet a portfolio on it?
Cashflowing whichever way the market moves is indeed a sign of a true investor.
Unfortunately, its outside of many people’s comfort zones. But stepping outside of that comfort zone may, in the end, prove less risky than staying in it…especially if stocks decide to make a hard right turn this year.
Becoming a True Investor by Breaking out of Your Comfort Zone
Commodity option sellers, of course, take their diversification aspect once step further than Tanner or Buffet in search of the additional benefit of higher yields. But it’s the mystique of commodities that often stops those that could and should, from taking that final step. They can’t get away from their comfort zone: stocks. And if stocks sink, they’ll go down with the ship. But at least they’ll be comfortable doing it.
Educating yourself to remove the mystique of options is the primary step towards escaping your comfort zone and confronting your fear of the unknown. We can help with that here.
But only you can take the next step. Actually taking that leap forward – and doing, instead of just thinking about doing.
Is this the year you take your step to other asset classes, other strategies, to cashflow regardless of market direction?
As Jim, Warren and Carl already know, stepping out of that comfort zone can be uncomfortable at first. But it can also reap rich rewards in the long run.
If I made you uncomfortable, rest assured. I did it for your own good.