Watch Video:
Listen To Audio Version:
Retail investors may confuse 2 very different strategies that sound the same. Covered puts is a risky strategy that involves shorting a stock and selling a put option. The trader is obligated to replace the “borrowed” stock and buy the shares at the strike price.
Selling cash-secured puts is a low-risk strategy appropriate for most retail investors that involves selling a put option and placing the appropriate amount of cash in the account to “secure” the put. Hypothetical examples are used to clarify the differences between the 2 strategies.
BECOME A BCI MEMBER TODAY:
PREMIUM MEMBERSHIP
SEE BCI COURSE & PRODUCTS :
BCI STORE
—
STOCKS,TRADING,STOCK MARKET,COVERED CALLS,covered call writing,Axsome,Therapeutics,Ellman Calculator,gap-up,cost-to-close,implied volatility,Alpha,Beta,seeking,alpha,cost-basis,time-value,intrinsic- value,put-selling,collar calculator,put calculator,stock option,facebook stock,amazon stock,investing,options,Option,option buyer,strike price,in the money,in the money coverd call,out of the money covered call,covered call writing exit strategies
