Creating Wealth in the Stock Market
D
When Hollywood actors and Silicon
id you know creat-
ing monthly residual Valley executives want to increase their
income in the stock
wealth, they turn to Tyrone Jackson
market is just a click
away? Now is a great time to be
they acquired.
a stock market investor and trader.
Mr. Gates and Mr. Buffet both follow a
In the last fifty-two weeks, shares of com-
panies like Netflix (ticker NFLX) have risen simple formula. Make your money on Wall
from $95 per share to over $300 per share. Street and invest the profits in real estate.
Similarly, shares of athletic yoga apparel Why stocks? Stocks are easy to buy and
maker LULU Lemon (ticker LULU) have sell. As a stock market investor, you have
gone from a fifty-two week low of $15 to the advantage of being able to trade from
anywhere in the world as long as you have
$64. That’s a400% percent increase.
This year has seen explosive growth in internet access. Next, when you buy and
stock prices and there’s more to come. Is sell stocks there are no credit checks, clos-
it a big surprise to the experienced trader ing costs, title searches or PMI (Protective
and investor? The answers is no. Here’s Mortgage Insurance). It’s possible for you
why: we are in the middle of a technologi- to purchase shares of a company at $50 and
cal revolution. The use of hand held devices sell them a week later for $55. That’s a ten
and the mobile applications that accompany percent profit.
Trading stocks can be a fast or slow
them are exploding worldwide. As a stock
market investor, you can cash in on almost transaction. Either way, it’s a simple buy
every trend you see around you. All of this low and sell high scenario. In a case like
innovation is financed, in part, by investors APPLE (ticker AAPL) it’s buy high and
sell even higher. Apple has a record four-
like you and me.
Here’s how the game works. We pur- teen straight quarters of top line revenue
chase shares of companies that are publicly growth. If you purchase shares now, the
traded. The capital raised from “going pub- potential for future growth is still present.
A $10,000 investment in Apple stock five
lic” finances R&D, marketing and advertis-
ing. In essence, we help finance the boom. years ago would be worth $70,000 today.
Our reward is evident when we purchase
Monthly Income
shares of let’s say XYZ stock at $50 and
one year later those same shares trade for Some stocks allow you to produce monthly
$120. That’s over a 100% increase in our residual income by selling covered call op-
tions. What are
initial investment.
How do you choose winning stocks? covered call op-
Here’s the big secret: on Wall Street, it’s tions you ask? It
all about revenue. When a publicly traded works like this:
Let’s say you
company’s quarterly and annual revenues
100
rise, ninety percent of the time so does the purchased
stock price. Your job is to learn how to read shares of XYZ
an income statement and choose winning stock at $9.75.
stocks. To do that you’ll need a financial Instead of selling
XZY stock at a
education.
higher price after
you
purchased
The Winning Combination
The most successful investors know the the shares, you
road to millions is paved when you have a sell the rights to
balanced portfolio of stocks and real estate. your stock first to create guaranteed in-
If we look at the two richest people in come. Selling a call option means that you
America, Bill Gates and Warren Buffet, would be selling the right, not the obliga-
they made their billions from owning shares tion, to someone in the market place to buy
in publicly traded companies. Some com- that stock away from you at the $10 price at
panies they started themselves and others a later date. The buyer of the option would
Realty411Guide.com
PAGE 29 • 2011
then pay you something called a premium.
In this example the premium is $.90 per
share. The price that you’ve agreed to sell
the stock at is called the strike price. In this
case it’s $10.
So in the above example you sold a call
option and earned a $.90 per share premium.
Simultaneously, you agreed to sell the stock
at the $10Strike Price. No matter what hap-
pens in this transaction, if the buyer decides
to buy the stock from you or let the option
expire, you get to keep the $.90 premium.
The buyer of the option could choose to
exercise that option at any time before the
expiration date and pay you the full $10.
If the buyer decides to exercise the option,
you would be obligated to sell the stock to
him or her at the $10 strike price but you
would keep the $.90 premium.
Let’s look at the total profit:
Stock bought at $9.75 and sold at $10
= .25 per share profit or 2.5% return
Plus .90 premium. =
.90 per share profit or 10%
Total profit on trade = 12.5% per month
Great News About Future Wealth
There’s still time for you to earn big bucks
as a stock market investor. With Facebook
and Twitter set with IPO’s (initial public of-
ferings) planned for early 2012, you can get
in on the ground floor…. sort of. With Wall
Street’s fascination with “all things social
media” at an all-time high, financial institu-
tions and hedge funds are sure to bid the
shares of these companies higher and
higher as their profits increase. So what
are you waiting for? You have a lot to be
excited about. Your next move is to start
to educate yourself about stock trading
and investing. From there, you’ll be on
the fast track with two different winning
asset classes, stock and real estate.
Tyrone Jackson is the founder and cre-
ator of the Wealthy Investor program.
Each month, Mr. Jackson teaches be-
ginners and seasoned stock market
investors how to produce monthly income
ranging from $5,000 to $30,000. Visit www.
TheWealthyInvestor.net for details. A fre-
quent radio and TV guest, Mr. Jackson wel-
comes your feedback, send to: feedback@
the wealthyinvestor.net
reWEALTHmag.com