Has anyone here on this forum heard of this thing called "renting shares", it is supposed to be avery proftibable way of making money in the stock market. Jamie McIntyre who is supposed to be one of the smartes businessman from Australia talks alot about it! Has any of you guys tried it???
theknifemac
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Trader333 said:
This is what a lot of the more savvy pension funds etc are now doing with their inventories - typically being long only they have large amounts of stock kicking around, so can increase their returns by making these inventories available for stock borrowing.
As Paul said, I guess this is what is meant by stock renting, but it only really works if you have the stock in the first place.
Stew
I think you will find he is just coming up with another term for writing Covered Calls. I have heard others refer to that as collecting rent from your shares. Either that or he might be referring to using long term options or LEAPS instead of buying the underlying stock and writing options or something against them.
squaregains
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renting to buy back? If so sounds like a Repo.
http://www.ticn.com/
These people have had quite a lot of publicity on radio in Ireland. I think I've heard them use the term renting to describe writing covered calls , as fxkiwi suggests.
robq
These people have had quite a lot of publicity on radio in Ireland. I think I've heard them use the term renting to describe writing covered calls , as fxkiwi suggests.
robq
chimpmagnet
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Sounds more like trading CFDs to me, i.e. put down 10% for margin and get the remaining 90% on "loan". You pay a daily holding fee (or "rent") for every day that you hold a long position, or you actually get paid the fee yourself if you hold a short position.
Though you never hold the underlying share, the derivative is good enough for trading and also for leverage to make larger profits (and losses!).
Though you never hold the underlying share, the derivative is good enough for trading and also for leverage to make larger profits (and losses!).
Renting shares
Yes, I have learnt about it from TICN. It is selling "covered calls" or "Options" on shares you own. It can be quiet good, perhaps 2-4% per month. Only downside is if the stock rises a lot, you will not benifit from it, as you have sold the right to someone else to buy them from you at an agreed price. Cannot do it on every share.
Yes, I have learnt about it from TICN. It is selling "covered calls" or "Options" on shares you own. It can be quiet good, perhaps 2-4% per month. Only downside is if the stock rises a lot, you will not benifit from it, as you have sold the right to someone else to buy them from you at an agreed price. Cannot do it on every share.
SecretTrader
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Renting shares is the idea of buying shares that you expect to rise. You then sell a call option against the shares. This is called a covered call stratgey and is nothing new. People like 'Nic Halik' sell this idea as their own invention. He sells a package called 'sharelord'. The idea is that the call is one or two strikes above the current price - so you want to be exercised on the option so that you (1) collect and keep the premium and (2) sell your shares to the call buyer for 5% or so more than you paid. To protect yourself from downside market risk you can use some of the call premium to buy a put one strike below the current.
works is the market goes up. But loses if you get it wrong.
works is the market goes up. But loses if you get it wrong.
do you trade youself mate? ive been trading covered calls for over 1 year now and even though some months the stocks have gone down below my strike price and breakeven for the particular month, i just rent the shares out again..and again..and again until i cover my losses
