Eliezer_Yudkowsky comments on Investing for the Long Slump - Less Wrong

8 Post author: Eliezer_Yudkowsky 22 January 2009 08:56AM

You are viewing a comment permalink. View the original post to see all comments and the full post content.

Comments (54)

Sort By: Old

You are viewing a single comment's thread.

Comment author: Eliezer_Yudkowsky 22 January 2009 10:46:09PM 2 points [-]

To concur with some others: write covered calls, preferably long ones to minimize your exposure to short rallies. This will give you a steady stream of income. If reinvested, it might yield 100 : 1. 128:1 would be 7 dblings, so in 30 years, that requires dbling every 4 years, so 18%/yr. Writing covered calls in a flat environment can easily generate that.

Patri, that only works for the first few years, until other people start thinking that the environment is flat. Then the selling price of calls goes down.