What you need to know about your Stock investing with infinity.
In this episode of Coffee with Carl, attorney Carl Zoellner covers everything you need to know about infinity investing.
You ever think about parallel universes?
Today I want to do something different, a crossover episode, sort of.
Anyway, some of you have asked about Infinity Investing– so, let’s get into it.
I’ll start with what is Infinity? In short, Infinity is the absolute best way to build wealth over time. And before you object with, “Really Carl, the best?” allow me to explain.
There’s millions of ways to make millions of dollars, but very few are guaranteed.
Infinity uses that very few, in fact, it’s all we teach.
It’s the boring investments that get skimmed over because, well, they’re boring. But you’re not here for excitement, so let’s get bored.
I’m going to take you through an infinity trade that I’ve actually been working through over the last few weeks, because the timing worked out perfectly for this post.
Taking a look at AT&T. Some of the attractive things I’m looking for are the dividends, which look great given the cost.
As of this AM, it’s a $26 stock. The way I went into this, I mentioned I’ve been trading this now for a few weeks. So the first time I went in, I went in and bought, actually I put up a put, or I bought a put, which means I’m basically saying I commit to buy at X dollars.
Then I went in and once the stock was put to me, I wrote a call on it. This means I rented it out and said, basically I will commit to sell this at X dollars, and I made a little bit on that. Not a ton. I think it was like a couple of hundred bucks.
Then this period came around where I no longer had the stock because I got called out of the stock. It was here I realized, I wanted to capture the dividend because the dividend is pretty nice.
Right now, it’s 7.82% or 52 cents a share.
This time, I didn’t actually put into the stock. What I did instead is I just purchased the shares and I made sure I was holding them on January 7th so that I would get the dividend payment for all of those stocks.
What I did was I bought the stock. I didn’t put into the stock and then I held the shares through 1/7. I wrote an option for a call that extended out past 1/7, a couple of weeks out, which is a little bit longer than I usually do, but a couple of weeks worked out fine for me.
Then, I collected a premium on renting that stock out, then that couple of weeks later, the stock got bought and I marked it as a dollar 50 premium per share when I wrote the call. So I made a couple hundred bucks on the calls and then somebody bought it out.
I made just over a thousand dollars when the stock got called away from me. We’re catching it in time, I’m basically rebuying to get back into AT&T because I like it and it seems to be heading in the right direction.
I’m not going to go into the chart tech or the charting technicals here. It’s a relatively stable stock that has seen some push up in pricing.
My interpretation of the market is I think AT&T will continue to go up, while we’re seeing some of the rockiness in the market. Also, as an FYI, I trade through my Roth, but I want to show you guys and gals, what it looks like to do an option contract.
E-Trade’s perfect for this, check out my video tutorial to see me interact with the market.
I like E-Trade because it’s very simple. You’re not required to use it, it’s really whatever you want, as far as the brokers are concerned. There’s commissions on this too–
–So there’s five bucks going to the house. Proceeds on this purchase would be $534, and if this 26.50 is greater than the stock prices at the end of the week, then I’ll own the stock at 26.50 and then I can start renting it out. If it’s more than 26.50, then I still get to keep that $534, but I don’t own any stock.
Now, you can chip away at some of your monthly income by putting into the stock and then if you own it, then I can call or write calls against the stock, I own at 26.50.
We’ll see at the end of the week, if it’s over 26.50 or not, and if I own the stock and if I own the stock, I can start renting it out and writing calls against it. Hopefully, that was at least a little bit informative.
It’s pretty simple, once you get the fundamentals down. I’m not doing anything complicated here. That was a quick 500 bucks on a Monday morning.
Let’s go back to AT&T because that’s the one we’re already using. Oh, by the way, one thing to mention on your home screen is that if you’re doing Infinity Investing, basically your home screen isn’t going to be super useful.
I’m concerned about the premiums I’m taking, as well as the ability to rent that stock. So realistically, I don’t really care about this number. By the way, this is only one of my small accounts here.
I’ve got a couple other accounts in other places too. But yeah, the -1.59 this morning means almost nothing to me because it’s not where I’m generating my income from the market. I’m generating it off those calls, those puts, in the premiums I’m going to charge when I write that call.
And also the dividend, because I’m making 7% when I owned it on 1/7 or January 7th at 800 shares. So I locked in that dividend, and didn’t get paid out until February 1st.
The other thing too, is if for some reason that option becomes less valuable or valueless, you can always buy it back during that period of time. Some people like it because it is definitely way more, set it and forget it.
Anyways, hopefully you enjoyed this special episode of Coffee with Carl. Please like and subscribe, if you haven’t already and share with your friends; hopefully it is informative.
So until next time, thank you for joining me with another episode of “Coffee with Carl.” If you do like this content, I would encourage you to subscribe and hit the like, so we can continue to make more content.
Keep taking advantage of our FREE educational opportunities and the free content we put out on the web. So that’s Toby’s Tax Tuesday, our tax and AP events for our clients who’ve already gone through our Tax and Asset Protection event.
Our Structure Implementation Series is fantastic. That answers a lot of the questions you have in the beginning. So there are a lot of different educational opportunities out there. One of my favorites as well is our Infinity Investing Workshop.
Resources mentioned in this video:
- For all things investing, check out the Infinity Investing YouTube channel
- Join our next Tax & Asset Protection event to learn more advanced tax minimization & entity structuring strategies
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