Printing dollars writing covered calls only to buy them back cheaper.

Quote from covered_call:

I agree with nazz...I think this lock on shorting is going to draw alot more attention to SSF as offered at One Chicago. SSF are much more popular in Europe than here in the US. Brokers have not pointed their customers towards SSF as means of shorting a stock because the brokerages make huge coin on the interest rates they charge customers for shorting stocks now.
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I agree but you got here "naked short selling" that is a kind of SSF LOL :p
 
Quote from MasterAtWork:

Basically, if you can't short a stock...........
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Do any of you hardcore option guys know if there's any advantage to selling-short "synthetically" via the options? :confused:
 
One disadvantage is the amount of time it may take to get filled in the options market. If you're arbing the stock in any way, you may have some slippage. This has been a problem with single stock futures (SSF) as well due to the lack of liquidity. Also, keep in mind, if you're doing something in the options market, you're counterparty could very well be hedging himself in the underlying as well so there's a natural execution race / problem.
 
Selling short 'synthetically' also limits your risk (if it's a naked short) and keeps your resources free as you won't need to deposit more margin and pay the huge interest rate brokers charge for short positions.
 
Quote from covered_call:

Selling short 'synthetically' also limits your risk (if it's a naked short) and keeps your resources free as you won't need to deposit more margin and pay the huge interest rate brokers charge for short positions.
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..also limits your risk..".

Why and how?
 
Quote from covered_call:

Selling short 'synthetically' also limits your risk...
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If it's 'synthetically,' then it's the equivalent position with (by definition) the same risk.

Mark
 
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