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The Long Game Advantage
Weekly Edition: January 28th, 2026
Market Movements
Current Level | Weekly Return | YTD | |
|---|---|---|---|
S&P 500 | 6,978.60 | 2.465% | 1.94% |
NASDAQ | 23,817.10 | 3.473% | 2.97% |
Dow Jones | 49,003.41 | 0.942% | 1.96% |
VIX | 16.35 | -15.329% | 9.36% |
Russell 2000 | 2,666.70 | 0.172% | 6.64% |
*Weekly Return is calculated as market open of the previous Wednesday, to market close this Tuesday (yesterday); Current Level is Tuesday’s (yesterday’s) close.
Weekly Rollout
Markets are mixed as we wait for the Fed decision
Speaking of the Fed, there is less than a 3% chance of a cut
The US Dollar keeps slip sliding away
Uncle Sam was not kind to health insurance stocks
Layoffs are the name of the game right now
Big tech earnings will decide if the AI rally holds
“Good-To-Know’s”
The Power of Compounding — Compounding often seems so slow that it’s unbearable.
At first.
But that’s why it’s underestimated. Early on, returns barely show up on our statements.
But stay consistent, and patient, and your portfolio begins to compound faster and faster.
Eventually, it compounds faster than you could’ve imagined.
The gains are earning gains. The gains’ gains are earning gains.
This is why investing for the long-term is one of the greatest financial decisions you can make.
See how compounding can affect $10,000 over 50 years at 4 different rates:
Year | 8% Return | 10% Return | 12% Return | 15% Return |
|---|---|---|---|---|
0 | 10,000.00 | 10,000.00 | 10,000.00 | 10,000.00 |
1 | 10,800.00 | 11,000.00 | 11,200.00 | 11,500.00 |
5 | 14,693.28 | 16,105.10 | 17,623.42 | 20,113.57 |
10 | 21,589.25 | 25,937.42 | 31,058.48 | 40,455.58 |
15 | 31,721.69 | 41,772.48 | 54,735.66 | 81,370.62 |
20 | 46,609.57 | 67,275.00 | 96,462.93 | 163,665.37 |
25 | 68,484.75 | 108,347.06 | 170,000.64 | 329,189.53 |
30 | 100,626.57 | 174,494.02 | 299,599.22 | 662,117.72 |
40 | 217,245.21 | 452,592.56 | 930,509.70 | 2,678,635.46 |
50 | 469,016.13 | 1,173,908.53 | 2,890,021.90 | 10,836,574.42 |
Quote(s) I Like
“I constantly see people rise in life who are not the smartest, sometimes not even the most diligent, but they are learning machines. They go to bed every night a little wiser than they were when they got up and boy does that help, particularly when you have a long run ahead of you.”
“Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.”
Thought Throttle
Most strategies and structures sound exciting when they’re explained. At first, they seem new and shiny.
But it is a different story when these novel things get put into practice.
People usually expect it to feel active, analytical, and constant. But in reality, it’s much, much slower. Much more quiet. And often, much more boring than we thought.
This isn’t meant to scare/depress you away from options, but to set realistic expectations. Options can certainly be exciting in most cases. But if/when the excitement fades, it is up to us to show discipline in our trading.
During the times when there is nothing happening in the market, one of the worst things we can do is jump the gun on a bad trade just for the sake of activity.
Stay disciplined.
Don’t abandon the principles of investing to try and un-strategically speed up your growth. At its best, selling options is a complement to a long-term portfolio. It works alongside ownership, not in place of it.
The point of selling options is to add a small, repeatable edge on top of ownership through patience.
By collecting small premiums, you’re monetizing time and uncertainty—things the market routinely misprices. The edge is modest, but over time, it can compound into returns that are the opposite of modest, lol.
But it’s not a substitute for owning good assets, and it is definitely not a shortcut around patience.
This is not some get-rich-quick scheme. It takes patience, perseverance, willpower, and the humility to accept errors/misjudgments and re-evaluate.
The goal is to stay consistent and disciplined, letting time do its thing. There will be bad trades along the way. Returns will not always be smooth. It will be boring at times, and it will take longer than you expect.
But selling options isn’t about doing more.
It’s about doing the right things long enough.
Trade Mechanics
This week, let’s keep it simple and straightforward with a cash-secured put on SPY. This setup generates income while positioning us to buy shares at a discount. The contract we’re using is the $680 Put (~31 delta) expiring March 20, 2026.
SPDR S&P 500 ETF Trust (SPY) | |
|---|---|
Current Price (1/27/2026) | $695.49 |
Put Sold | Mar 20 ’26 $680 Put (~31 delta) |
Premium Received | $9.13 |
Capital At-Risk | $67,087 = ($680 − $9.13) × 100 |
Return if Not Assigned | $913 ÷ $67,087 = 1.36% |
Annualized Return | ≈ 9.95% |
Cost Basis if Assigned | $670.87 (~3.5% discount) |
This trade pays $913 up front for agreeing to buy SPY at $680 if shares dip by expiration. That’s our income for patience. If SPY holds above the strike, we simply keep the premium. If assigned, we’ll own 100 shares at an effective cost basis of $670.87, providing entry below current levels with the ability to sell covered calls against our new shares if we wanted.
In short, this is a get-paid-to-wait trade. We collect income now for being willing to buy SPY later.
This is for educational purposes only—not a trade recommendation. Remember to always do your own due diligence and consult a financial advisor before making investment decisions.
Throttle Q&A
Why Do Some Tickers Always Have Higher Implied Volatility Than Others?
Implied volatility doesn’t just measure fear, but uncertainty. Companies with explosive growth potential or headline risk (like TSLA, NVDA, or RIVN) have futures that are harder to price, so their options trade richer. The market charges more for unknowns.
On the flip side, predictable “boring” names like KO or JNJ move in smaller, steadier ranges. Their earnings are routine, their surprises rare, and their IV stays naturally low.
Every stock has its own rhythm and temperament. Before judging whether IV is high or low, get to know the company. Some are volatile, others are built for cruise control.
Expected Returns of Selling Options Compared to Dividends
Dividends typically provide steady, reliable income, with yields ranging from 1% to 4%, depending on the industry. They are considered lower-risk but offer more predictable returns.
Options premiums can provide higher returns, especially in range-bound or volatile markets, as they depend on factors like stock movement and volatility. Many options sellers shoot for a return of ~2-3% a month, though not always achieved due to the volatile nature of options.
Basically:
Dividends: Steady income, moderate returns.
Options Premiums: Potentially higher returns, higher risk.
Got any questions or comments? Feel free to reply to this email—we’d love to hear from you!
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Disclaimer
The information provided in this newsletter is sourced from reliable channels; however, we cannot guarantee its accuracy. The opinions expressed in this newsletter are solely those of the editorial team, contributors, or third-party sources and may change without prior notice. These views do not necessarily reflect those of the firm as a whole. The content may become outdated, and there is no obligation to update it.
Options come with inherent risks. We strongly advise you to consult with a financial advisor before making any investment decisions, including determining whether any proposed investment aligns with your personal financial needs.
