About Ron - What's the Story
I just retired from working at a major company for over 40 years. During my career I was in Human Resources but focused on Corporate Benefits, M&A, and retirement programs since 1994. I also was the focal point for managing an outside provider who did recordkeeping and services for the company's retirement and health and welfare programs. I was also involved in the design and implementation of several major benefit and stock plan programs.
I am fortunate that our company offered a pension plan (not many left anymore) and a solid 401k program. Together, along with solid savings over a lifetime I have been able to achieve a good financial base for my retirement. One of the challenges I face, as well as most of you who have to handle 401k, IRA or other cash is how to safeguard my assets into retirement and not run out of money too early. Plus, buy whatever I want to buy with reasonable limitations (the dream).
So in 2007 I decided to adopt a dividend paying stock strategy. I read a couple good books on the subject and decided that if I could find enough solid companies with good records of dividend payments and growth I could build my own retirement cash account plus safeguard assets for my grandkids.
For a while it worked great. Dividends started coming into my account and I felt I had the right solution. But as you know, the economy went into a tail spin and my great dividend paying stocks started lowering or dropping dividends and their stock prices dropped like a rock. I believe in 2008 the market fell 38% or so depending on the index.
I took defensive action and closed my eyes and sold off all my stock positions and went into nearly all cash. I was able to hold my 2008 loss to around 20% but not a happy guy to say the least. I can't afford to lose my assets as they are a significant part of my overall retirement program.
So, I begin searching for a better approach and covered calls was my solution.
The Covered Calls Farm
Planting and Harvesting Covered Calls for Fun and Profit using a Farming Strategy
Adopted Covered Calls Strategy end of 2008
A close friend of mine, Farmer Ira, and I car pooled together in 1982. We didn't have much money but both of us had an interest in the stock market and stock options. So we bought a book called
"Options as a Strategic Investment" by Lawrence G. McMillan. It had a section on covered calls which Ira and I would discuss during our commute. At that time we really could not do covered calls because commissions were too high, the technology was limited and we just couldn't afford to put money in the market when kids had to have braces and food.
Well, over 26 years later Ira and I worked together again and in 2008 and 2009 we both were trying to determine the best approach for managing our investments with retirement ahead of both of us.
We pulled out the old book and bought others. With discount brokers, advanced technology, ease to manage the account we both begin to do a few buy/writes. So, 2009 was a year of learning how to use the systems, what to buy and not buy, profits and yes, losses on several trades. Our company offered a great work schedule with every other Friday off so we had the time to manage our accounts and keep learning.
Over time we begin to talk about the Harvest, Crops, Crops Rotation and the idea developed that this is like a farm. Since my heritage is a family who farmed in Arkansas and some of them are still in the business today it just made sense to implement this approach. Plus, I find it fun to see if I can explain this strategy with this approach.
I wanted to create something that others could understand and help the Farm Community grow together. Hopefully, this is being accomplished and you can gain knowledge and help us as we grow.
With the above knowledge you will better understand why my goal is to focus on the North Forty Crop vs other short term strategies. All will work and I do like Alan Ellman's approach. I am in a different stage of life and really want more downside protection and an approach more like a money machine. North Forty Crop Approach
Thanks for coming to CoveredCallsFarm.com
What's Up? Why such a website? Why a farm?
Thanks for taking an interest in the Covered Calls Strategy. Hopefully, this website will help you better understand the strategy and if you decide to adopt will make a difference in your overall success.
Updated: November 14, 2010
Having fun at the Grand Canyon
Managing the Farm at
a Waffle House. All you need
is your IPAD and and IBD.
My Most Valued Crop: My Grandchildren