Steve, your buying power would fluctuate with two things: the closing prices on your underlying stocks, thus total portfolio worth; and also, the closing prices on the various stocks you've sold puts on. For the latter, as I said, they take one of three formulas, whichever is the most exensive. And change that day to day. If you've sold puts on a stock that has seen a rapid runup for instance, so that your puts are nicely deteriorating, you nonetheless may find substantial margin held, as they will base it on the price of the underlying, which has gone up markedly.
So when selling puts it's wise to leave a very nice cushion of margin for worst case scenarios--i.e. a major correction, and/or major fluctuations in underlying prices. |
