"Obtaining Continuous Income with Ferris Wheel Strategy"

What is the Wheel Strategy?

The Wheel Strategy offers a calm and systematic approach to investing in the financial markets. While many investors prefer exciting strategies, this method attracts less attention and focuses on creating long-term added value. The Wheel Strategy aims to increase your investments while also trying to minimize risk.

Fundamental Principle of the Strategy

This strategy is based on collecting premiums in stock trading without rushing. The investor starts by selling cash secured puts (secured put options) related to the stocks they wish to acquire, thereby initially earning premiums. If the stock does not fall to the predetermined level, only the premium gain is realized. If the stock does fall, the investor adds this stock to their portfolio at the price they wanted to buy it.

Product Management and Cash Flow

Once the stocks are in the portfolio, the investor then sells covered calls (protected call options) on these stocks to enter the premium collection process again. If the stock price rises, the call option is exercised, and the stocks are sold. If it does not, the stock is kept, and a new call option is sold. This cycle can create a strong income source for patient investors.

Who Is It Suitable For?

The Wheel Strategy is suitable for those who adopt a patient and disciplined approach rather than chasing quick profits. Investors who embrace this method may experience less excitement in volatile markets while steadily increasing their returns. However, selecting the right stocks is critical to the success of the strategy; the liquidity and financial stability of chosen stocks support the sustainability of the strategy.

Risks and Considerations

The Wheel Strategy is not a risk-free method. Unexpected market and company movements can put investors in difficult situations. Additionally, the limited potential for returns and the inability to capitalize on other opportunities should also be considered. Investors must be aware of these risks and avoid making emotional decisions.