What would be the best option selling approach to obtain this target return. Is it realistic? I was looking for something similar to the following: http://www.ljmpartners.com/english/history.php (bottom chart)
respectfully you must not have researched the capital markets very much. there are dividend paying stocks paying 11-12% and they could have easily be found with 10 minutes using google for example, NRGY, selling at a discount, current will get you around 11%, paid quarterly
11-12% assumes non-equity like risk. The was of course implied. Also, what does 11% do of me if the stock gets halved in price or worse? Please check your facts and do your own research before giving faulty advice and accusing others of not doing the same.
LOL! +1 OP needs to head over to the CBOE site. You can read their studies on options selling. They claim equity like returns with lower volatility. You can lever that up a little bit to get the returns you want.
Well, if you want a steady 11% per year return and you realize that you are taking on some large hidden risks in return for nice and steady looking returns, you could: 1. Sell calls and puts outside the market just far enough to get a 0.873459% return each month from the premiums. 2. Pray that the market doesn't move outside your strangle and blow you up. Presumably, shops like LJM do a little more analysis than that and allow some variability in returns.
risk=reward. you're gonna have to put some risk into these markets if you want to make money. It doesn't just spit out 10%+ returns annually without you putting some money on the line for risk. Strong companies with healthy dividends is a good idea, presumably if you have a good company, you won't get halved in the stock and you'll collect an income. But then again you want non equity movement and non directional. Options will get you a return, but it takes one bad move in selling options to really get burned.
Atticus had some good comments in the thread "generating $1000/month on $150k" (I think he started 10 or so pages in to the thread). If I recall, his basic approach was a buy/write strategy on a diversified basket of low-volatility stocks while maintaining an insurance policy against market meltdown by purchasing OTM VIX spreads. Might be worth a look...