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All 3 positions have exactly the same risk/reward ratio. The reason being that there are synthetic equivalents of each other. That is, buying the stock and selling 77 call is synthetically equivalent to selling 77 put. Likewise, buying the stock and 75 put is synthetically equivalent to...

The risk is exactly the same in all 3 combinations (call vertical, put vertical or stock collar). Also, whether you pay or receive premium (as is the case in a short put vertical) is completely irrelevant since you would also have a margin requirement, which would reduce your buying power as...

Or you can just buy a 75 call and sell a 77 call, and achieve exactly the same thing. On a side note, you can also sell a 77 put and buy a 75 put to, once again, achieve exactly the same thing.

To calculate your return you simply link the return between withdrawal dates. That is, you calculate your return each time there is a cash flow to or from your account, and then start the next period with the new balance. Then you just link the returns to arrive at the total return for the whole...

That depends on the put's delta. ES has a delta of 50 (i.e. each point is worth $50, while each point in SPX is worth 100), so 2 ES means a delta of 100.

There is no best approach, and noone is gonna just spill the beans here, if you know what I mean.

It's not free money. By selling a call option you limit your upside. If the stocks explodes to 100 then you would forgo the $5,000 profit on the shares and go away with a measly $200. Also, the premium of $200 you receive for the call only gives you protection for $2, if the stocks falls...

As mentioned above by others, the main difference is that warrants are issued by the underlying stock's company or in some cases by a bank. Options, on the other hand, are not issued by anyone in that sense. Also, when warrants are exercised the company issues new shares, which then dilute...

First of all, SPX and RUT options are settled based on the final settlement value, which is calculated using the opening print of all component stocks, so until you know the settlement value you do not know whether your options have expired OTM or not. Sometimes the final settlement value can be...

I don't know when you looked at those prices, but based on your post's time stamp it looks like it was afterhours. I suggest you only look at them when the market is open, otherwise the pricing is not real.

Dividends are priced into options so there is no "arb" to exploit. Also, if you are assigned on your short call then you would be assigned on the day before the stock goes ex-dividend, which means you would be responsible for paying the dividend (assuming you don't own the stock and thus you...

Unless it is you who got screwed. If you are assigned on a short call due to a dividend then there is no gift for you.

If you buy the underlying and sell the calls then the calls are not naked. You can just buy the calls to hedge the delta, but you would still be exposed to changes in implied volatility and time decay, not to mention that you would be delta-hedged only over relatively small moves since as the...

I have already answered this question. If you are long 20 Feb 122 puts then to hedge them you would buy 2000 shares of SPY and at the same time sell 20 Feb 122 calls. The resulting position is a "perfect" hedge.

Your post is confusing. The first sentence asks about a call, but then in the example you mention a long put. A perfect hedge is to close out the position. :D If you are long 122 puts then a perfect hedge would be a short synthetic put, which consists of a long stock and a short 122 call.

Unfortunately, you don't have the same risk simply because if SPY is at 60 at expiration then the shares are still worth 60, while the leaps would be worthless. If you use leaps to double your holdings then you leverage yourself 2:1.

Sure, why not, but you have to realize that you are gonna lose most of the time. I think it is best to place these into earnings so that it ends up to be a sort of a binary bet - you either win or lose, there is no in-between where the option doubles and you sell out, and thus miss the rest of...

Stocks are settled on a T+3 basis, but it is irrelevant to the discussion. You cannot just cancel the transaction after it has taken place, but before the actual settlement.

OK, before you get any more comments similar to mine...If you want informative answers then you need to ask specific questions! Your question whether anyone has any success buying ITM puts and calls with 30 days or less to expiration is similar to asking whether anyone has any success in...

Yes.