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Selling put options to generate income: Is it a good investment strategy?
By The InvestQuest  •  June 30, 2021

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Telegram Group: t.me/theinvestquest (or search “The InvestQuest” on Telegram)Whatsapp Broadcast: Just send “Hello IQ” to +65 8840 2520Facebook Page: The InvestQuest | FacebookLinkedIn Page: The InvestQuest | LinkedIn Investors sell put options on stocks for a variety of reasons – as an income generation strategy, to monetize volatility, or simply because they desire to buy a stock (but only at a lower price). In this article, we discuss if selling put options is a viable long-term investment strategy. To do this, we compiled the historical outcomes of selling puts on the S&P 500 since 2000, across varying holding periods and strike levels. And computed the losses incurred should these put options be exercised upon maturity. We see a similar strategy being used by many Private Bank clients in the form of investing in Fixed Coupon Notes (FCNs) and Equity Linked Notes (ELNs), which are typically structured...
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By The InvestQuest
The Invest Quest was founded on the premise that the average investor makes sub-optimal investment decisions as a result of information asymmetry. It is our hope that this platform will narrow the information gap against the “smart money”.
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