Writing puts on indexes
- Thread starter amooseman
- Start date
I hear there is a state down south where this concept originated. They also voted for Trump
Simply put, hedging is defined as protecting yourself in the case of an unforeseen event is it not?
Selling OTM late in the week.. Weekly Puts are a great hedge. Example: your holding 3000 shares of AAPL, you might like more shares... but only if your entry price is considerably lower than AAPL is trading. Sell OTM Puts today for AAPL trading @ 229.50... sell 50 units Oct-5th 225.00 strike @.53...I just hedged my 3000 shares purchased today slightly above 226.550. Gained 2,750 at the sale to hedge my 3000 share purchased @ 226.50. A short term hedge with a cash bonus...I know..I know your going to tell me AAPL is not an indice..just giving a perspective..
You fellows are really into semantics...I on the other hand just trade to make money. The only people who didn't vote for the Don....I will bet have hands deeply into Uncle Sams pockets
)Simply put, hedging is defined as protecting yourself in the case of an unforeseen event is it not?
Selling OTM late in the week.. Weekly Puts are a great hedge. Example: your holding 3000 shares of AAPL, you might like more shares... but only if your entry price is considerably lower than AAPL is trading. Sell OTM Puts today for AAPL trading @ 229.50... sell 50 units Oct-5th 225.00 strike @.53...I just hedged my 3000 shares purchased today slightly above 226.550. Gained 2,750 at the sale to hedge my 3000 share purchased @ 226.50. A short term hedge with a cash bonus...I know..I know your going to tell me AAPL is not an indice..just giving a perspective..
You fellows are really into semantics...I on the other hand just trade to make money. The only people who didn't vote for the Don....I will bet have hands deeply into Uncle Sams pockets
Shorting OTM is not a hedge. The price reflects the moneyness. Semantics? It’s not a hedge to short OTM. You’re a case study in what not to do. You’ll cry suitability when you blow-up with these short puts.
Simply put, hedging is defined as protecting yourself in the case of an unforeseen event is it not?
Selling OTM late in the week.. Weekly Puts are a great hedge. Example: your holding 3000 shares of AAPL, you might like more shares... but only if your entry price is considerably lower than AAPL is trading. Sell OTM Puts today for AAPL trading @ 229.50... sell 50 units Oct-5th 225.00 strike @.53...I just hedged my 3000 shares purchased today slightly above 226.550. Gained 2,750 at the sale to hedge my 3000 share purchased @ 226.50. A short term hedge with a cash bonus...I know..I know your going to tell me AAPL is not an indice..just giving a perspective..
You fellows are really into semantics...I on the other hand just trade to make money. The only people who didn't vote for the Don....I will bet have hands deeply into Uncle Sams pockets
You remind me of a guy who I met on a train to nyc a few years ago. He was pro-trump because trump was going to remove the Alternative Minimum Tax, which according to this guy gave huge tax credits to millionaires. As this guy was saying this he claimed that he always read both sides of all the issues.
Sell ATM cash covered puts on SPY 6 mos out when the prems are 20%. That's what happens on a sustained VIX over 60 during major bears. At these all-time highs, you can get crushed with the piddly prems they offer.
You've got to go to lower priced stocks in vital industries to get 13-15% prems ATM 5-6 mos out. They tend to channel so doing that aporoach on bigger dips gives you a decent edge to where getting assigned doesn't have you in a dead position for long, esp. if you stagger several sells giving you a cost avg at least 13% ahead of the real-time transaction price of the put sells (ALWAYS cash covered).
You've got to go to lower priced stocks in vital industries to get 13-15% prems ATM 5-6 mos out. They tend to channel so doing that aporoach on bigger dips gives you a decent edge to where getting assigned doesn't have you in a dead position for long, esp. if you stagger several sells giving you a cost avg at least 13% ahead of the real-time transaction price of the put sells (ALWAYS cash covered).
Sorry to hear you must be anywhere NYC...I ping my trades to the Street...and that's it. The Don cut his teeth in NYC a good thing for all of us he understands how to handle the backstabber's in DC...
Yeah. He tamed the NYC real estate market all by himself without ever getting bailed out by his father. We are lucky to have him running our economy.
Completely off topic, but it seems that is what this blog is all about... I'll postulate a little lessen to do with economy....& bailing out.
1."money=work=money"
2. He who gets to "print" money "has the biggest gun".
3. He who has the "biggest gun" (& is willing to use it) Wins!
4. That's why the dollar is the World's currency, and guess who gets to print the dollar...talk to Uncle Sam about bailing out...
naked put writing is not advisable -anyone get smashed to bits this week and crying as they read this? The peanuts you collect from selling will get wiped out in a heartbeat. I've been trading options for 19 years