Are there relative low risk investment alternatives to CDs with better performance? A little more risk is ok.

Answer 1

Sure, buy a steady company's stock and sell an option on it.

For instance, Chevron has been bouncing around 77-78 in recent days, and a nice upward trend of about 25 percent over the past year. Say you spend $78 and quarter, plus commission, for a hundred shares (about $7832). Current prices for the $75 option is $3.60 (35 cent value premium), for the $70 is $8.30 (5 cent premium), for the $65 is 13.90 (65 cent premium), and to sell it at $80, the option is 60 cents. That is something like about 2.8 percent annualized. This is just to show the mechanics.

Now, shop around other upward trending stocks for something that have options that sell in for an even greater value gap. I've found some, from time to time that will give some better value than the money in the bank, all the while the underlying principle has grown. Now if the option you sell is 'in the money' then even if it gets called, you've sold it at a solid price, you have lost nothing. The bigger the value gap, the bigger the return on the money, all for locking in a pre-set price to sell your stock, IF someone wants to exercise the option. If not, you still have your stock to do it all again next month.

Answer 2

I beleive there may be some money markets out there that offer slightly better rates than a CD and its liquid as opposed to locking your $ into a CD with a term.

Answer 3

Banks use the money that you give them for cd's and they buy real estate tax lien certificates. Why not buy them yourself instead and make the 25% return yourself?

http://bstsystems.taxliens1.hop.clickbank.net

Answer 4

Everyting has some risk. My current pick is SXL paying 5.5% and going up with possible takeover.