I wrote 15 cash secured puts on GE (strike 13 feb)

[KINGOFSHORTS]

80 cents a share.

Will I get slammed with 1500 shares?

 

[Lucrum]

If you're worried what we think about your trade maybe you should have conducted the poll before you sold puts.

 

[KINGOFSHORTS]

This is a fun poll, I am not worried or I would not write the puts

I am doing my civic duty by selling equity insurance to scared investors at 80 cents a share. Keeps them sleeping well at night.

Time and the DRIP effect + 1.57% of float shorted is on my side + Obamanator bear rally effect.

 

[NoDoji]

Strong trade and I almost did that myself today.

 

[darwin666]

in the worst case , they are assigned to you, may be you can roll them to next month .

but I think you will be fine. with your break even 12.2.

 

[Loki]

I do exactly the same.

I sell naked puts to scared investors and since I have the cash in case I get assigned I don't mind.

I usually sell naked puts on stuff I would like to own for my portfolio.

2 things:

1) I do believe that it gives me an edge. Often people go in and out of options/stocks while I just wait it out, since I can take some heat.

2) I often try to understand the logic behind it. I get paid real money and as we all know there are no free money on Wall Street. However I am still not sure what service is that I am providing.

Do naked put sellers let investors sleep well at night ?

Is that what we get paid for ?


ps: I sold naked puts on SAY 10 contracts Feb 09 strike price $ 2.50 the premium was $ 1.50

I could lose the $ 2500 + $ 1500 premium if it turns out really ugly and SAY goes bankrupt I will lose $ 1000

still...I am sleeping at night

 

[darwin666]

ya. right.. try telling that to folks who sold naked puts in October on most commodity stocks.

like MOS . fell from 90 to 30... great stock to own....

POT.. fell from 140 to 80.. another gem..

everybody wanted to own them cheap..

 

[KINGOFSHORTS]

Quote from darwin666:

ya. right.. try telling that to folks who sold naked puts in October on most commodity stocks.

like MOS . fell from 90 to 30... great stock to own....

POT.. fell from 140 to 80.. another gem..

everybody wanted to own them cheap..

I would never write puts on shit like that or commodities which is a whole different ball of wax involving things like variation calls etc..

I was covering shorts in oct and november

 

[NoDoji]

Quote from darwin666:

ya. right.. try telling that to folks who sold naked puts in October on most commodity stocks.

like MOS . fell from 90 to 30... great stock to own....

POT.. fell from 140 to 80.. another gem..

everybody wanted to own them cheap..

Oh please, GE can only go to 0, it's not the end of the world.

 

[dsq]

Quote from KINGOFSHORTS:

80 cents a share.

Will I get slammed with 1500 shares?

A WHILE BACK when this bear was taking hold and GE was at 28 you were saying you were long.Didnt you write a bunch of puts then and again when ge was at 20 and now again you are going against the stock?

Maybe you ve traded in and out whatever but this fighting the trend thing you got with GE is painful.Youve had a bullish bias on ge from 30.Getting married to a stock is dangerous and avg down with dog is not good strategy.You should be shorting GE not buying.