options experts: PBR is going ex-div tomorrow. do i need to pay the div selling puts?

klattermusen

klattermusen

options experts: PBR is going ex-div tomorrow. The 15 strike puts are .30 If you sell the puts (naked write) are you also responsible for paying the div?

I'd like to just collet the .30 prem but it'll suck if I have to pay the 5% or more div (PBR div is 20% annual)

Also it .30 seems high for 1dte - is it pricing in a brief selloff.
 
Fyi, have been watching this one. Great dividend plays out there for the pro's. Huge call volume today, over 1,000,000 calls traded so far.

Pro's love these plays as there is a lot of public open interest. And the public may not realize that they should exercise their calls. Large dividend as well, 1.21 expected.
 
FSU said:
Fyi, have been watching this one. Great dividend plays out there for the pro's. Huge call volume today, over 1,000,000 calls traded so far.

Pro's love these plays as there is a lot of public open interest. And the public may not realize that they should exercise their calls. Large dividend as well, 1.21 expected.
More...
FSU said:
Fyi, have been watching this one. Great dividend plays out there for the pro's. Huge call volume today, over 1,000,000 calls traded so far.

Pro's love these plays as there is a lot of public open interest. And the public may not realize that they should exercise their calls. Large dividend as well, 1.21 expected.
More...

$1.21 div would mathematically take it to under 15 tomorrow. Maybe thats why the 15 puts are still showing a value of .25

It could still close above 15 considering how hot the oil sect is...
 
klattermusen said:
options experts: PBR is going ex-div tomorrow. The 15 strike puts are .30 If you sell the puts (naked write) are you also responsible for paying the div?

I'd like to just collet the .30 prem but it'll suck if I have to pay the 5% or more div (PBR div is 20% annual)

Also it .30 seems high for 1dte - is it pricing in a brief selloff.
More...

No. It's the opposite. When you get assigned on your puts, you actually end up buying the shares, if before ex-dividend, you will end up with the dividend.

In fact, you never pay dividends as option sellers because dividends are paid by the company that issued the shares after declaring the dividends, but especially not by a put seller.
 
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