No-Fee Trading: Trade Options and Make Income
- Online brokerage Robinhood was the first to offer free stock and options trades to every investor.
- To keep up with competition, brokerages across the country are lowering their trading costs to $0.
- Chad Shoop shares a unique strategy that allows you to take full advantage of trading at zero cost — and generate income with every trade.
Brokerages across the country are now offering no-fee trading accounts.
This is great news for retail investors — especially for beginners.
Now you can buy one share of a stock every paycheck to get started — and you don’t have to worry about the costs.
Today, I share a strategy that’ll ensure you take full advantage of no-commission trading. Plus, you’ll generate income with every trade.
Robinhood: No-Fee Trading for All
Robinhood — a startup brokerage — was the first to put the no-commission trend in motion.
It offers free trades. It doesn’t matter how much money you start with or your investment experience.
You get free stock and options trading.
To keep up with competition, traditional brokerages such as TD Ameritrade, Charles Schwab and E-Trade have dropped their trading fees to zero.
I’m excited that everyone will be able to enjoy lower trade costs. And I’m even more excited about what it means for one of my favorite strategies: selling options.
If you are not familiar with selling options, don’t worry — it’s super simple.
Two things to keep in mind when you’re trading options:
- You sell a put option when you want to possibly buy a stock.
- You sell a call option when you already own shares of the stock and are looking to sell your shares.
I love selling options because you get paid to buy and sell your stock.
Whenever you sell an option, you collect a premium.
That premium is yours to keep.
Here’s a quick example:
You find a stock you’d like to own and sell a put option on it. Then you collect the premium, and based on the price you selected, you either have to buy the stock or not.
And it’s the same for selling calls on a stock you own. You sell a call option, collect the premium, and you either have to sell your shares or continue holding them.
That’s a general way to trade options. I use this strategy in a way that allows me to generate income every time I make a trade.
Sell Options and Make Income
Now, I sell options for income. This strategy creates consistent income in any portfolio.
You can watch my video below for more details on options trading without the fees.
And with zero fees to get in and out of trades, it’s a must for every investor who wants to buy or sell shares of a stock.
Options can expire every month or every week. So it’s up to you when and how often you trade them.
Some options trade as low as $0.05 per share, or $5 per contract. In this case, it wouldn’t make sense to pay $5 to $10 to place the trade and collect $5 for selling the option.
But with no fees, you can now collect this extra income every time you want to buy a stock that offers options on it.
I know many of you are hesitant about options because you’ve heard there’s an added risk trading them. But selling options actually reduces risk.
And once you get the hang of it, you’ll love this strategy as much as I do. Plus, you don’t have to trade options alone. I can help you get started.
Pure Income: Your Best Strategy for Consistent Income
I’ve been selling options for years. As I’ve said before, it’s my favorite investment strategy.
You can learn it on your own, but it’s a lot easier to follow someone who knows what they are doing.
Some of the biggest compliments I get on my premium services are not about how much money my readers make.
I want my readers to make money — that’s my goal. But knowing how much they learn and build up confidence on trading options is far more rewarding to me.
Whether you want to do this on your own, or whether you want me to walk you through it, I’m here for you.
To me, selling options was a must-have strategy for income before fees were lowered. Now it’s a no-brainer strategy — whether you’re looking for income or not.
And I want to help you get started.
My colleague Matt Badiali put together a presentation walking you through how it all works.
Click here to watch it now.
When you’re done, you can join me and learn everything you need to know about this income-generating strategy.
I know you’ll love it as much as I do.
Chad Shoop, CMT
Editor, Pure Income
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