Account Net-Liq: $7,437.20
SPX value: 3,479.73
Shiller PE: 32.01
I was looking for opportunities where I can store my cash in my trading account in lieu of leaving it in the account, sitting there and doing nothing.
I also didn’t want to withdraw them and save it in a savings account. That would work against my Net-Liq.
I also wanted the money to be blocked, so I couldn’t use them in other trades. I am now saving cash for another trade I want to take (buy LEAPS against SPY and start selling covered calls) and I must admit my discipline is not yet perfect and I might be tempted to use that money on another trade. So locking the cash in equity which would not lose value and even make some would be perfect.
But, where could you put your money, short term, preserve their value, and maybe make some? Make better than 0.0009 APY the broker may pay you for cash?
This is a question to savers all around the world too. If you look at the current savings accounts rates, you would want to cry!
The rates are pitiful and they may drop even lower. Poor savers! Retired people who depended on CDs or savings accounts are ruined.
I finally found a good opportunity! Thanks to another investor in a Facebook group, who pointed me to an opportunity which may do exactly what I am looking for – safety, stability, and some decent income.
iShares Ultra Short-Term Bond ETF (ICSH)
ICSH is a short term bond ETF that seems to fulfill my needs. It holds its value (slightly going up), it pays dividends (nothing extra), the yield is about 2.20% at the current price of $50.56 a share, but definitely better than today’s high yield savings accounts) and during March selloff it only lost about 4.45% while the entire market lost almost 40%. Not bad in my opinion. And, it pays a monthly dividend.
I believe, this is a good way to hold cash, or if you are afraid of the stock market, or a retiree and looking for a savings account which pays better yield (a lot better) than current high yield savings accounts, then, in my opinion, ICSH is a good option to do.
Thus, my goal is to save $4,000 in my brokerage account and then buy SPY LEAPS calls and start selling covered calls. I will be saving my cash using ICSH.
If you are interested to see what stocks and what options we trade, then join us at MeWe. We no longer participate at Facebook (very little though) but we are active at MeWe.