Stock Investing Strategies

Stock investments

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4 Methods of Making Money From Your Stock

There is a long list of different ways you can make some money in the stock market. Appreciation can be extremely powerful, however it is not the only thing to look for. So, how can you make money from a stock that you own? What are the 4 best ways to get money from your long term investments?

1. Dividends

Dividend paying stocks give off a great income that can definately add up after many years of holding it. A company may choose to pay a portion of their profits to their stock holders as a way of rewarding them for investing into the company.

Some professional investors will consider this the most powerful method of making money because it pays out consistently. However dividends are not the only way to make money off of a stock that you already own.

2. Capital Appreciation

This is the method that can be the most powerful and therefore is the most popular. The idea is you buy a stock it goes up and you sell it for a profit. Appreciation can be the single biggest way to make money off of a stock if you get into the right one. That is why checking a stocks fundamentals and technicals can be so important.

3. Covered Calls

Covered call writing is an amazing way to profit. If you sell a covered call you are selling someone else the right to buy the stock from you at a certain price on or before a certain date.

The only problem with this strategy is that it could potentially force a person to sell their stock early. But it is still a powerful strategy none the less.

4. Selling puts

Another very interesting strategy is called selling put options. It can help an investor start to make money even before they enter a stock. By selling a put you are letting someone else sell you a stock at a certain price sometime in the near future.

As long as you are willing and able to get into the stock at that predetermined price it can be very profitable.

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