Chapter 5. Two Popular Strategies and How to Improve Them
• Have you ever bought a stock with the view of holding it for some time, but you wanted to ensure against a downturn, just in case?
• Have you ever bought a stock with the view of holding it for some time, but where you wanted to receive a “dividend-like” payment every month for owning it?
• Have you ever bought a stock with the view of holding it for some time, where you wanted to receive the dividend-like payments but also wanted to ensure against the downside?
Well, the answer to all three questions is that you can do them all!
Example 5.1.
Let’s look at buying a stock again:
Chart 5.1 • Risk profile of buying a stock.
As you can see, your risk is what you pay for the stock in the ...
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