What’s so great about Renting Australian Shares? Strategy-wise, it’s an excellent way to make money on the Australian stock market.

Renting Australian Shares Strategy For The Market

The practice of selling options on your Shares (i.e. “rent” shares) is a good way to accrue wealth from the Australian market. Done right, it’s a way to make a profit every month, while putting yourself in very little danger of losing money. You also don’t have to devote your career to day trading to make money from Renting Australian Shares.

Strategy Is To Rent Consistent Shares

The best way to earn wealth risk-free from Renting Shares is to look for companies whose stock does not change very much from month to month. In the Australian market, this is generally easier to do than finding that “golden” company whose stock you think will rise way up.

Why does this strategy work so well? It has to do with why is renting a Share officially called “Selling a Call Option” on that share.

If you are Renting Shares of company XYZ, you’re getting money from another investor who is speculating that XYZ stock will go up dramatically. You are selling that investor the “option” to purchase XYZ shares from you at a later date (usually a month later), at a set price. You are getting a premium (your “rent”) on that Share, which you will get to keep regardless of if XYZ stock goes up, goes down, or stays the same. If XYZ stock goes up higher than you determined in your initial agreement to “rent,” you automatically sell your share to your renter for the agreed-on price, in addition to the premium. If XYZ stock stays more or less the same, you keep the Share, and the premium.

That way, you can keep renting out the same Australian Shares month by month, and earning money from them, practically while you sleep.

Written By
Scotty Smith - Planet Wealth