Can you make a video talking about how much buying power this takes up? I'd really like to sell naked options and I have a margin account on TW but it seems like it is unhappy with me and the information online is limited/not consistent with what TW is telling me.
In margin accounts there is more relief, but in an IRA account this is true. In any case, we can always buy far out wings for a few pennies to define our risk and likely reduce buying power.
The best thing about market is you can justify everything you do. . . What about the day where market goes completely against you....and what about the circuit days then what....... your years of profit is going to the drain....always be prepared so when time comes your response will be automatic.
Great video. How does your brokerage determine how many calls you are allowed to sell? What’s the margin requirement, or how is the margin requirement figured out?
Shoud we sell put ITM or OTM, either side how far from ATM? Without having knowledge n experience I hv sold PUT in ITM quite far from ATM. Its been a week there's no volume n movement in premium its same since I sold. But stock is trading above strike price.. whats gonna happen if it never touches strike price until expiry? Please advice. Thanks
You really shouldn't be selling puts without experience. I don't even sell make options because I don't yet know how to profitably hedge my risk. In your case, you like sold an option with little to no volume. If I'm not mistaken, since you sold your put, you received a credit. That credit will remain yours and the option will expire worthless(which is want you want when you are SELLING puts).
Correct, but max loss is realized at a much higher %, and management opportunity is very low. Much more of a binary static trade compared to a short put which is very dynamic.
@@edwashingtoniii9898 So if you were selling a naked call at a 20$ strike price, and the stock goes above that 20$ strike, you will have to purchase the 100 shares at a higher price than you sold them for. So if you sold for 20$, but stock goes up to 25$, you have to buy 100 shares at 25$ and sell them to the buyer for 20$.
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Ive been a tasty trader for 4 years now. This is an EXCELLENT presentation - as are all of Mike's White Board presentations! Thanks!
I am learning a lot from Mike's whiteboard. I have even been rolling some naked puts for credit as I lower the strike price.
Mike and Tom are the best. I like naked, I don't like spreads
Amazing video.. I'll definitely use your strategy to roll a naked option .very easy to understand the way your teaching. Thanks
One day I will Understand all this, I'm claiming !
Can you make a video talking about how much buying power this takes up? I'd really like to sell naked options and I have a margin account on TW but it seems like it is unhappy with me and the information online is limited/not consistent with what TW is telling me.
thank you Mike ..outstanding
It just eats up sooo much buying power.
In margin accounts there is more relief, but in an IRA account this is true. In any case, we can always buy far out wings for a few pennies to define our risk and likely reduce buying power.
The best thing about market is you can justify everything you do.
.
.
What about the day where market goes completely against you....and what about the circuit days then what....... your years of profit is going to the drain....always be prepared so when time comes your response will be automatic.
Love your videos
Great video. How does your brokerage determine how many calls you are allowed to sell? What’s the margin requirement, or how is the margin requirement figured out?
Typically 20-25% of the strike price is the margin requirement
Shoud we sell put ITM or OTM, either side how far from ATM? Without having knowledge n experience I hv sold PUT in ITM quite far from ATM. Its been a week there's no volume n movement in premium its same since I sold. But stock is trading above strike price.. whats gonna happen if it never touches strike price until expiry? Please advice. Thanks
You really shouldn't be selling puts without experience. I don't even sell make options because I don't yet know how to profitably hedge my risk.
In your case, you like sold an option with little to no volume. If I'm not mistaken, since you sold your put, you received a credit. That credit will remain yours and the option will expire worthless(which is want you want when you are SELLING puts).
I think my brain only woke up when you said naked
he looks like the guy from inthemoney
He actually said its his brother!
percent return is always much higher with bullput spread than a naked put...
Correct, but max loss is realized at a much higher %, and management opportunity is very low. Much more of a binary static trade compared to a short put which is very dynamic.
@@tastyliveshow thanks !
Great video
Naked options all the way!
Guys I need help with this being explained to me any resources.
Buy lowwwww sell highhhhhh
Good
Yeah but the capital that is used is massive
I actually prefer United....Delta sucks
I fly United.. (Well.. Used to fly) Pretty often, and it's such a treat whenever I get to fly Delta.
is the presenter the same guy who owns option alpha? They look a lot alike.
Hmmmm ........
*Sells 9999 naked puts on Tesla at $600 strike price expiring in a day *
one benefit of buying options: if you play it right, you never have to pay taxes again.
how is this posibble
@@rochester3 I believe Humberto is implying that you will always lose money in that case.
Those facial ticks are really distracting..but damn he's handsome
Huh?
selling naked is very risky.
explain why
Yes I also want to understand. It seems easier because you don't need the underlying stocks
@@edwashingtoniii9898 So if you were selling a naked call at a 20$ strike price, and the stock goes above that 20$ strike, you will have to purchase the 100 shares at a higher price than you sold them for. So if you sold for 20$, but stock goes up to 25$, you have to buy 100 shares at 25$ and sell them to the buyer for 20$.