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#360 - What Is Capital Appreciation?: Hey everyone. This is Kirk here again at Option Alpha. Welcome back to the daily call. Today, we’re going to answer the question, “What is capital appreciation?” This is more of a basic concept, but I thought it was interesting to just add it in...

#360 - What Is Capital Appreciation?: Hey everyone. This is Kirk here again at Option Alpha. Welcome back to the daily call. Today, we’re going to answer the question, “What is capital appreciation?” This is more of a basic concept, but I thought it was interesting to just add it in...

A partire dalThe "Daily Call" From Option Alpha


#360 - What Is Capital Appreciation?: Hey everyone. This is Kirk here again at Option Alpha. Welcome back to the daily call. Today, we’re going to answer the question, “What is capital appreciation?” This is more of a basic concept, but I thought it was interesting to just add it in...

A partire dalThe "Daily Call" From Option Alpha

valutazioni:
Lunghezza:
3 minuti
Pubblicato:
Sep 17, 2018
Formato:
Episodio podcast

Descrizione

Hey everyone. This is Kirk here again at Option Alpha. Welcome back to the daily call. Today, we’re going to answer the question, “What is capital appreciation?” This is more of a basic concept, but I thought it was interesting to just add it in here because we did get a question on this from a user who was just wondering like what's the difference between investing for income and investing for capital appreciation. Capital appreciation is nothing more than just the rise in price due to the market or the underlying factors of that security. This could mean that the general market is rising, so most stocks are rising with the market or that a particular company or ETF is doing well or something well is happening in that sector or industry and so, that causes a rise in price as well. That's one of the ways that you can obviously make money as an investor and stock and equities trader, is just to play the rise in capital appreciation. Now, conceivably, most people and most investors in the entire investing universe, I'd say 99% of them, this is the only way that they know. There's a one-directional road to making money and it's a rise in the stock or ETF or index price of whatever they’re investing in. Obviously, we know that there's another path and that is that you can generate income from selling options, you can generate income from dividends or from covered calls, you can play the decline in capital, so not capital appreciation, but capital decline where you can profit from a decline in an underlying security. I think it’s an interesting concept because it's a one-directional street that most people think you have to travel down, but there's actually many different paths to generating income. Capital appreciation is one way, that's how most people play it, but it's not the only way. Hopefully this helps out. As always, if you have any questions, let me know and until next time, happy trading.
Pubblicato:
Sep 17, 2018
Formato:
Episodio podcast