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A modern Berkshire-style compounding framework built on disciplined float management and recurring income generation.
Value-Trades follows a float-based compounding approach, comparable to an insurance or investment holding company. The system blends long-term equity ownership with an active reinvestment loop that continuously redeploys premium and dividend income.
| Metric | Result |
|---|---|
| Overall portfolio growth | ≈ 20% year-to-date |
| Target annual compounding | 15–20% |
| Focus | Consistent positive cash flow through all market cycles |
Realized losses are treated as capital recycling events that refresh liquidity for new deployments. The compounding cycle functions as:
TL;DR:
Bought 100 shares of BMY at $44, sold a Jan 2028 LEAP covered call for $19, dropped my real cost to $25/share, still collect the 5.7% dividend (~10% yield on deployed capital), and freed up $1,900 cash to reinvest — all while deferring taxes until the contract closes.
I picked up 100 shares of Bristol-Myers Squibb (BMY) around $44. Instead of just holding for the dividend, I immediately sold a covered call expiring Jan 2028, collecting roughly $19 per share in premium.
The premium is already credited but taxes are deferred until 2028.
This setup turns a slow dividend stock into a self-funding income engine:
It’s basically the reverse of margin: you’re getting paid to “borrow” against your shares.
Q: What’s the catch?
A: You cap upside and hold longer, but you gain steady income, tax deferral, and redeployable cash.
Q: Do you still get dividends?
A: Yes — as long as the shares remain in your account. Early assignment can skip one dividend but is rarely material.
Q: Why not just sell puts?
A: Selling puts gives similar income, but covered calls let you collect dividends, defer taxes, and immediately use released capital.
This approach turns a steady dividend stock into a tax-efficient, yield-enhanced compounding tool. You’re earning income twice — from the call premium and the dividend — while recycling released capital into new opportunities. It’s not just “buy and hold.” It’s buy, extract, and compound.
Educational illustration only — not investment advice.
🔢 Try the Calculator 📈 View My Trading StrategyTo expand book value and cash-flow capacity each year through disciplined float management and option-based income generation. The aim is a scalable, durable system of compounding built for modern markets — a “Berkshire-style” business model adapted for personal capital management.
