Planet Wealth Stock Market And Options Trading

The practice of renting shares is a little-known way to make a regular income on the Australian shares market. Why is it such a good investment to rent Australian shares? Strategy comes into play here.

Renting Australian Shares: Strategy?

By renting shares (otherwise known as selling “call options” on your shares), you can almost always earn a tidy monthly income without too much risk. Furthermore, it’s one of the only ways to earn a regular income from the market without spending 8 hours a day looking at prices.

Here is a strategy to follow to maximise your income from renting shares in Australia.

Renting Australian Shares Strategy: Find Reliable Stock

Renting shares is one of the few market strategies that actually works well with stock whose price doesn’t change much from month to month. When you rent shares, you are essentially selling someone the “option” to buy the shares from you later. However, you get a certain amount of money (known as the “premium”) from the other investors to whom you are renting your shares, regardless of if they buy your shares or not. If you can keep getting premiums from investors while rarely having to actually sell your shares, you’ll essentially be making free money.

Of course, if the price of the shares goes up, you’ll make even more money. However, it’s easier to predict when a stock’s price will stay the same than it is to predict when a stock’s price will go up dramatically. When you rent shares, you don’t have to put yourself at risk by speculating on the fate of wildly fluctuating stock.

Written by Clint Maher - Planet Wealth
Planet Wealth Solutions © 2008