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We can look more in-depth at the stock by looking at the option chain – this is the actual list showing buyers that are willing to purchase an option against your share at a certain price.
Looking at the actual numbers, as of 5/26/2022, Apple (AAPL) was trading at $164.58 (I’ll round up to $165).
We need to have 100 shares for this strategy – option chains work in blocks of 100. 100 shares of Apple at $165 will cost you $16,500.
For this example, we are looking at a 29 day option chain, to keep this similar to a rental property scenario.
Looking at the option chain, we can see there is an opportunity for a $165 strike price. This means someone will buy it from you for the same exact price you paid. By choosing this option, we can get $6.15 off each share.
This gives us $615 of “rental income” for 29 days.
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Image and article originally from thebrownreport.com. Read the original article here.