Warren Buffett's Income-Generating 'Wheel' Strategy
Update: 2025-12-04
Description
The Wheel Strategy: A Proven Income-Generating MethodDiscover a straightforward income-generating strategy used by legendary investor Warren Buffett, known as the wheel. This method combines two basic options trades with traditional stock ownership, creating a repeatable way to earn money.The strategy involves three steps:1. Sell a cash-secured put option on a desired stock, collecting a premium if the stock doesnt drop to the specified price.2. If the stock is bought, sell covered calls to generate ongoing income while holding the stock and receiving dividends.3. When the stock price rises above the covered call strike price, your shares are called away, completing the cycle and locking in gains.This strategy pays you at every stage, offering premiums from both puts and calls, and potentially dividends. Its a controlled and systematic approach, working best with high-quality, liquid companies like those in the Nasdaq one hundred or well-known blue-chip stocks.
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