Exactly. For example I thought it would be a good idea to own JCI(pays a dividend, mostly stable, etc). as part of my long term goal. Overall I am up over 100%, but this is after about a year and of course I am still holding the stock.
So for me a somewhat aggressive(either at strike or close to it) put was a way to try and get more of that stock and if the prices rises no big deal, I got paid to try. Typically the premium was around 2.5-3.5% of the strike. With a 2 week put and doing this at a rotating level I was basically growing my account by a measly 2.5-3.5% every two weeks. Not the kind of gains you guys brag about, but over the course of a year it works out to basically doubling my money(i think) year over year for(in my opinion) fairly low risk. Same concept with a covered call.
Example of what I did the last two weeks, 1500$ cash, sold a put for almost all of it(1478 or something) for 38$ expiring at the end of the week, this is about 2.2%. So to you big boys this 38$ is a joke, but it also took me 10 minutes and is fairly low risk. 38x52(weeks a year) and I made 1,999$. Or almost double my original 2k. Obviously getting that 2.2% every time isn't a guarantee(sometimes its 1.x%) and at some point I may actually have to buy the stock but then I reverse the process with a covered call.
Anyway that is what I was doing and it wasn't terrible but unless you feed the machine it doesn't really grow at any huge rate.
I know you guys will turn that 2k into 2.5k in a day and then do it again tomorrow. Wish I could do that and I am actually starting to get interested in advancing my skills around here to do just that...with more realistic goals, like turning that 2k into 2.1k regularly
