How has the investing gone? Seems like 2017 was a good year, but 2018 has been a little more challenging.
I have a large sum of money coming in later this year, and I'm thinking about investing it. Passive investment with an index fund is generally a good long-term strategy, though I strongly suspect we're in for a recession in the near future. I'd hate to lose 20-40% of my investment within a few months of putting it into the market.
On the other hand, the amount of money I'll have on hand will be enough to do some things that most people can't. For instance, I'd have enough money to execute an option without trading on the margin on fairly large stocks, as opposed to selling the options contract, which seems to be the more common strategy. If I understand this correctly, that should enable me to be able to make small but reliable returns with relatively little risk.
Hopefully I didn't mangle the terminology too badly. I'm researching all of this stuff somewhat frantically, and I'm new to it. I'll have to spend a couple months doing paper trades before I'm comfortable with putting real money into options.
Passive in terms of time commitment and effort. I don't think there are truly passive income streams unless you have substantial capital to invest in the first place (eg: vanguards and rental property)
I think scalable income is a more useful concept than passive income. What I mean by scalable income is when you can increase your income by investing more capital, but keeping time commitment and effort at the same level. In my view purely passive income is either some instance of rent-seeking, or simple risk-free return on economic growth. But even those require a minimal level of effort.
I have a large sum of money coming in later this year, and I'm thinking about investing it. Passive investment with an index fund is generally a good long-term strategy, though I strongly suspect we're in for a recession in the near future. I'd hate to lose 20-40% of my investment within a few months of putting it into the market.
On the other hand, the amount of money I'll have on hand will be enough to do some things that most people can't. For instance, I'd have enough money to execute an option without trading on the margin on fairly large stocks, as opposed to selling the options contract, which seems to be the more common strategy. If I understand this correctly, that should enable me to be able to make small but reliable returns with relatively little risk.
Hopefully I didn't mangle the terminology too badly. I'm researching all of this stuff somewhat frantically, and I'm new to it. I'll have to spend a couple months doing paper trades before I'm comfortable with putting real money into options.