Using The Strategy Behind Renting Shares To Earn An Easy Passive Income

Currently, many people in the USA and elsewhere are without any monthly earnings due to unemployment. Being out of a job does not have to mean loss of any earnings whatsoever. Some people continue to make money using the strategy behind renting shares even without a regular 9-to-5 job.

Due to the economic downturn, many people think that investing in American stock market is not a wise move. However, it is possible to earn monthly passive income easily by renting out shares. Similar to renting out a home or any other property, renting your shares to others gives you a wonderful chance to build an alternative revenue stream. Previously known as call options trading, renting out shares has a much lower risk compared to buying and selling shares or actual trading of shares.

Immaterial of whether the share price increases, remains the same or decreases slightly, you can enjoy a monthly passive income by renting out your shares to others. To rent out the shares, you can ask for a protected or writing call option when you purchase the shares. The protected option comes with an insurance policy to cover for losses due to a very bad drop in the share price. Some people may not buy the insurance policy.

Investors may simply keep the shares until the share price rises again. Generally, it is possible to earn around two to four percent of the share capital each month. With an insurance policy, you can enjoy a guarantee of seventy-five percent or so of the total capital. The writing call option or writing covered call does not come with any insurance policy. After buying the shares, the rental price and duration of rental is usually set, similar to renting out a house.

You can ask the assistance of a share broker or use the Auto Trader service for the rental price and duration setting. There are a few ways to earn money by renting out your shares. As mentioned earlier, it is possible to enjoy a passive rental income every month. If the company decides to give dividends to its shareholders, you get your portion of the dividend as well. In the event that the share price increases over the months, you can enjoy the gain in the capital.

To summarize, it is possible to earn monthly passive income easily by using the strategy of renting shares. With such an income, there is no need to worry about unemployment or loss of monthly earnings. Renting out shares is similar to renting out a house in a number of ways. Apart from getting monthly passive income, there is a chance to gain money through company dividends or increase in share price.

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