Comments on: Selling Put Options: How It’s Done & How Easy It Can Be http://www.contrarianprofits.com/articles/selling-put-options-how-it%e2%80%99s-done-how-easy-it-can-be/19077 Access market-beating ideas from the world's top investment gurus on stock market investing, the gold market, ETFs, Forex trading and real estate values. Tue, 18 May 2010 05:09:46 -0500 http://wordpress.org/?v=2.8.5 hourly 1 By: willy http://www.contrarianprofits.com/articles/selling-put-options-how-it%e2%80%99s-done-how-easy-it-can-be/19077/comment-page-1#comment-78224 willy Sun, 18 Oct 2009 21:45:17 +0000 http://www.contrarianprofits.com/?p=19077#comment-78224 Really new at the idea of selling covered calls.Can you use some kind of stop loss to bail out if your pick is really tanking. You would not want all those shares PUT to you if the price is going way-way down. Particularly if you have 5or 10 contracts!!! Should one only (ever) buy the # of option contracts to equal the # of shares you might normally Buy?? What if we have a sizeable , say 20% pullback on the whole market??? DO YOU jump in early and BUY BACK AT A LOSS ? Really new at the idea of selling covered calls.Can you use some kind of stop loss to bail out if your pick is really tanking. You would not want all those shares PUT to you if the price is going way-way down. Particularly if you have 5or 10 contracts!!! Should one only (ever) buy the # of option contracts to equal the # of shares you might normally Buy??

What if we have a sizeable , say 20% pullback on the whole market??? DO YOU jump in early and BUY BACK AT A LOSS ?

]]> By: Jay http://www.contrarianprofits.com/articles/selling-put-options-how-it%e2%80%99s-done-how-easy-it-can-be/19077/comment-page-1#comment-77819 Jay Fri, 16 Oct 2009 12:56:53 +0000 http://www.contrarianprofits.com/?p=19077#comment-77819 Yup, selling puts make sense if one wants the underlying stock at a specific price. For example: JNJ is currently selling for about $60- I would be more than happy to purchase it for 45 or even 50 and keep the option premium. Using the 45 strike price I would get $1.10 for a 15 month option. The issue though is that I can't find a broker that will allow me to expedite this trade. Scottrade for example wanted 100% of the strike price ($4500) for an option that would yield $110- this is less than 2% and, of course, idiocy. So my question is simple: who will charge a REASONABLE (margin) rate for this kind of trade? Thank you, Jay. Yup, selling puts make sense if one wants the underlying stock at a specific price. For example: JNJ is currently selling for about $60- I would be more than happy to purchase it for 45 or even 50 and keep the option premium. Using the 45 strike price I would get $1.10 for a 15 month option. The issue though is that I can’t find a broker that will allow me to expedite this trade. Scottrade for example wanted 100% of the strike price ($4500) for an option that would yield $110- this is less than 2% and, of course, idiocy. So my question is simple: who will charge a REASONABLE (margin) rate for this kind of trade? Thank you, Jay.

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