Income Investment Strategy (Covered Call and Secured Cash Put) Vs Buy Hold Comparison


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IconMeaning
Strong Buy - Excellent fundamentals and deeply undervalued
👍Buy - Slightly undervalued with good growth potential
⚠️See Analysis - Fairly valued, further research recommended
Highly Overvalued - Trading significantly above fair value
Avoid - Flagged in database as not recommended regardless of valuation
Data Missing - No reliable fair value or price data available

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Explanation:

  • Buy & Hold: Uses a 9% (2% above average index return) annual compounding return with tax deferred until the end, where only 15% long-term capital gains tax is applied. This approach benefits from the tax advantage of compounding.
  • Income Strategy: Assumes 12.5% net annual return after paying higher short-term taxes and considering occasional losses. Upside is capped but risk of a catastrophic wipeout is minimal, and it provides regular income for peace of mind.

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