Questions tagged [put-options]
A put option is a contract giving the owner the right, but not the obligation, to sell–or sell short–a specified amount of an underlying security at a pre-determined price within a specified time frame. Related tags are [call-options, options, options-assignment, option-exercise and should be used when appropriate.
280
questions
1
vote
2
answers
116
views
cheapest ways to hedge
I would like to know what are my options in protecting my equity portfolio in the short term. I assume there are different costs involved in each. I own a number of ETFs and would like to protect ...
- 565
0
votes
3
answers
109
views
What will happen when option premium rise very high for shorting put?
Suppose the commission is zero for trading stock option such as trading stock in some broker ,and all other fee is zero.There is a put option,exercise price is 2.5 USD, option premium is 2 USD,i have ...
- 433
0
votes
1
answer
94
views
Why does the *leverage* of an open-ended option change over time (and so quickly)?
I wonder how the leverage (not the price) of an option changes over time and why so quickly?
Naively speaking, I think of an option as the possibility to buy a stock at a certain price. If an option ...
1
vote
2
answers
141
views
Can someone explain to me the best option strategy here?
NOTE: By "covered put" we mean covered by a short position, not a cash-secured put.
I have the following question from my SIE textbook:
If a customer had a large cash position and was ...
3
votes
1
answer
192
views
ITM long put resolution after expiration
I'd like to understand how the following scenario is handled. I'm using Interactive Brokers and its cash account and I'm talking about US stock options. I don't take into account transaction fees and ...
- 131
0
votes
1
answer
176
views
Long Put -- Can't execute
I'd like to buy a so-called "naked" put option on VTI. In order to exercise the put if the price of VTI is at the strike price or below, I must find someone to buy it at the strike price. ...
- 1
3
votes
2
answers
2k
views
I have a put option affected by a dividend that has been renamed and no longer traded but is ITM
I have a put option affected by a dividend that has been renamed and no longer traded but is solidly in the money (MBI $8 puts). It appears as worthless in my app. I am considering exercising it. I ...
0
votes
1
answer
83
views
Can you effectively reduce the cost of a long call on an index with a synthetic long and married put (e.g. replicate an XSP call using SPX options)?
Imagine you want to use periodic cashflows to purchase deep-in-the-money LEAPS (>1yr expiration calls) on SPX, but the size of the cashflows are too small to do so consistently (the cost of such a ...
- 103
2
votes
1
answer
277
views
Tax-Savvy Pre-Retirement Liquidity Cushion, or IRS Surprise? -using put options and an IRA
I have 300 shares in a regular account with basis 166, trading @ 500. I have over 300 shares of the same in an IRA. I plan to sell 300 shares in the IRA; write 3 puts in the IRA for less than $10,000 ...
- 133
3
votes
1
answer
615
views
Explaining equity being analogous to a call option and bonds being equivalent to a short put
I read this:
Equity in a corporation is essentially a call option on the enterprise
value (the sum of all the firm’s assets) with a strike price equal to
the firm’s debt. The firm’s bonds are a risk-...
- 143
1
vote
2
answers
293
views
ITM option exercise immediately after buying on E*Trade
I bought a put option with strike 453 for 3.23 per share with the current underlying price at 448. This means that I should be able to exercise immediately and make 1.77 per share profit. I’m using ...
- 11
0
votes
2
answers
86
views
DOW Mini Futures Options Liquidity - Symbol YM
I am trading on the Interactive Brokers TWS platform. That is the name of the broker and the platform they offer that I use. I have noticed that there is almost no liquidity on the YM Mini option ...
- 1
0
votes
0
answers
116
views
Put Options with strikes 30 and 20 on the same asset with same maturity are trading for $6 and $4 respectively. Can you find an arbitrage?
New to finance questions and reading from 150 Most Frequently Asked Questions on Quant Interviews. In the solutions section of this book, it says:
In the plane (K,P(K)) the options values correspond ...
- 1
1
vote
1
answer
263
views
What happens to First Republic Bank (FRC) Short Puts on acquisition by JP Morgan?
I own 5 Short Puts with strike price @ 11.00 with expiry being 19th May 2023. Since trading is halted, I may not be able to execute or close the position. What will happen to this position once JP ...
2
votes
1
answer
85
views
tax treatment of naked put LEAPS held more than one year
Say I sold ONE,(January 21,2022 AMZN 3100 PUT) for $506.25 on September 16, 2020 and bought it back on January 21 2022 for $94.04. Is the Gain Long Term or short term ?
- 21
5
votes
1
answer
1k
views
What happens to SIVB put option holders?
As title implies - I own put options (Strike Price $125, exp. March 17 2023). I am wondering what happens to other owners of put options.
As we all know now, SIVB is in receivership. I do not own ...
- 51
0
votes
2
answers
556
views
How does buying put orders on robinhood work if you purchase after hours
Here is my current scenario:
I bought a put option for 390.00 on 03/09 after market close, the status is still set as queued
I see now that the aftermarket price is 390.06
If after market goes below ...
- 101
-1
votes
3
answers
237
views
IV applied to Buying Vs. Selling Option Contracts!
Is low IV (Implied Volatility) good for selling or buying options?
0
votes
1
answer
84
views
How to Roll Put Options (Buy to open)? (Bought to Open)
I have a put option that I bought to open but the market has moved against me. So I'm looking for a way out of the contract other than taking a huge loss. I want to know my options for rolling them ...
3
votes
3
answers
394
views
How options affect the index?
I am not able to get technical/logical reason behind following scenario. Can you please help me to explain the reason behind it?
Context:
Group of stocks makes the index. It means Index is dependent ...
0
votes
1
answer
154
views
Are premiums from options taxable at assignment or sale of the security?
If I write puts that end up assigned, meaning I purchase the underlying security, are any taxes generated by the option in the year when it gets assigned? Are taxes only generated when the underlying ...
- 419
2
votes
3
answers
222
views
Why did my put lose value overnight
I bought a put option yesterday 10/20/22 with a strike price of $26. The price of the security was at $28.00, and the expiration set for 11/18/22. The security price dropped to $20.00 overnight. Why ...
- 21
0
votes
1
answer
174
views
Bought Put Options that are getting close to Expiration
If I let my option expire ITM (Bought Put Option) I will then own those shares. My account won't allow me to do covered calls or covered puts so I can't leverage against them. What are my other ...
0
votes
0
answers
46
views
I have sold stock PUT option with strike 32,5 and expiration date JAN 2023. Stock will be acquired fully in cash for 32,25 in Q12023
What will happen with my PUT option if acquisition will happen before my put option expires?
- 1
0
votes
2
answers
201
views
Why is simply buying an in-money-call and a lower strike price put near an event date a good low-risk high-reward strategy?
My premise is that buying both an in-money-call and an lower strike price put near an event date, is perhaps, one of the better low-risk high-reward strategy.
Why? If the stock moves significantly ...
- 131
0
votes
0
answers
144
views
'Inversion' of option chain: calls are more expensive than puts above the strike price! GME
Over the past two days there has been a weird phenomena on GameStop's options where the call options are more expensive than the put options above the strike price. I would have imagined that some ...
- 101
0
votes
2
answers
148
views
About getting out of a long PUT option trade
I think about making my first options trade and after studying a bit, I couldn't find answers to some of my questions. So here I am.
What I want to do is buy a PUT option on a stock that I speculate ...
- 103
0
votes
1
answer
90
views
What's the negative about buying contracts 1 month out when scalping options? (Is it buying same day or 2-3 day contracts are way cheaper?)
What's the negative about buying contracts 1 month out when scalping options? (Is it buying same day or 2-3 day contracts are way cheaper?) I don't want Theta to negatively affect my gains.
- 1
0
votes
2
answers
326
views
If I exercise an ITM put option in an account with zero positions open, will the put option exercise if I have adequate capital in my account?
I only buy puts.
I now have a question about exercising puts.
I am not able to exercise puts in my simulated account, so I wanna ask you guys & gals a question before I try it on my real account.
...
- 1
1
vote
1
answer
33
views
Correct evaluation of warrants
The warrant below (on TR) gives me the right to sell a stock for the strike price (at the day of expiry).
At the current market price of the underlying of 744 USD and a strike price of 1150 USD, the ...
- 113
0
votes
1
answer
490
views
How do I close a put option when the company is about to file for bankruptcy?
I opened a put options by selling so I must buy to close. The company I have the open option position with is about to file for bankruptcy. How should I go about closing my put option. What's the ...
0
votes
1
answer
64
views
how to sell short - buy/sell to open/close
I'm intstd in selling short as there's a stock I think will drop, but i've never done it and am filled with trepidation.
I head to options on my trading site and off the bat seem to have five......
- 115
0
votes
1
answer
451
views
Do I need to worry about dividends when trading credit spreads?
I trade in the options market, mostly with vertical credit spreads. If one of my underlyings has a dividend coming up, does that affect my holdings? My guess is that the short and long position would ...
- 774
3
votes
1
answer
480
views
How to calculate an annualized rate of return with a number of cash-secured Puts?
For cash-secured-puts I know how to calculate the annual return of a single one like:
(Returns divided by Capital at Risk) x (365 divided by Holding Period in days)
With a "wheel" strategy (...
- 459
0
votes
1
answer
73
views
Is there any difference between placing a "buy & sell call option" & "buy & sell put option"?
I have attached two Options order charts.
Max profit & loss are the same. But one (put) costs less than the other (call).
Is there any real difference between these two orders? Is there any real ...
- 3
5
votes
3
answers
2k
views
What happens to my put options on RSX expiring March 18 2022, if RSX remains halted then?
I bought put options on RSX (VanEck Russia ETF) that shall expire March 18 2022.
How can I sell them now for profit? I don't want the underlying RSX shares. I just want to cash out on my gain!
If ...
user116038
1
vote
2
answers
674
views
Why was my Short Put Option position assigned early?
I sold a Put Option months ago. The Option was deep in the money and expired last Friday, but was assigned early the previous Wednesday afternoon. Why? What does the holder of the Option gain from ...
user19035
0
votes
1
answer
49
views
Making a long put into a long put spread
Let's say I have a long put and it's Friday. I still think it has good potential to move down but I just want to be protected over the weekend in case the trade goes against me drastically because of ...
- 101
0
votes
1
answer
43
views
Long ratio put spread versus call strategy for stock of ABC company
Part(1)
Long ratio put spread versus call strategy for ABC company
Current market price:$639, view: moderately bearish
Buy 2 February 630 Puts@ 35.00
Sell 1 February 660 Put@ 52.00
Sell 2 February 690 ...
-1
votes
1
answer
130
views
How to trade stock e.g, BABA using monthly options (wheel strategy)?
Say you want to buy up to 400 shares of BABA in the current $130 range to $100. How do you implement an option strategy in the meantime to make some extra cash while waiting for a $10 stock gain?
Buy ...
- 29
0
votes
2
answers
394
views
How does wash sale rule affect protective puts?
TLDR: Do sales of long puts at a loss and purchase of underlying stock within 30 days qualify as wash sale rule?
Let's say I am a long term investor on SPY, and I buy $1,000 of SPY every month on the ...
- 101
2
votes
3
answers
214
views
Does, buying a put involve someone to sell a call?
Does, buying a put involve someone to sell a call ?.
When a trade to buy put is made from one side does it means someone is selling a call from other side. ?
- 143
0
votes
1
answer
80
views
When to sell put option
Buying a put option happens when market is going down. Correct. If that is true then when should one sell put option ?
- 143
0
votes
1
answer
59
views
option best ask doesn't move unless I place an order lower than the best ask
as in the picture.Before I placed an order.The best ask was 0.35 and did not move at all.This option's volume was very low.
And then I placed a 0.30 sell order, size was 73.
Suddenly the best ask size ...
- 139
2
votes
1
answer
592
views
What does buying put option at a certain amount mean?
Example :
BUY BANK NIFTY 39000 PUT @ 246
In trading platform there is no choice like this. How does one interpret this in simple
language.
- 143
1
vote
2
answers
102
views
Calculating put-call ratio when volume is @0
So i have to do a put-call ratio plot. However i have to decide between using open interest and volume to calculate PCR. But in our data, the volume for some put/call options are 0. Is there a way to ...
- 11
0
votes
1
answer
61
views
Some PUT options down while others are up
I read the other posts about how implied volatility can affect the option price. However, I still cannot explain the following situation. The underlying stock is down 8%, and most of the PUT options ...
- 101
0
votes
3
answers
316
views
Why does the DJIA take a dip on the 19th of every month since May?
The Dow Jones Industrial Average has a brief downward spike on the 19th of every month since May 2021, except where the 19th falls on a weekend - so, May 19, June 18, July 19, August 19, September 20. ...
- 339
1
vote
1
answer
263
views
How does expiration/assignment work in synthetic covered call
What happens if I let a short call expire worthless on a synthetic long stock I've purchased.
Here's my scenario.
Bought a CALL @ 870 and sold a PUT @ 870 both expiring in 177 days. Also sold a CALL @ ...
- 11
0
votes
1
answer
114
views
Short options trade ITM assignment criteria
Can someone please explain something about the option spreads? How come this broker is not exercising these short options in this video as they are deep in the money?
https://www.youtube.com/watch?v=...
- 39