Option Strategies Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Option Strategies

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Elroy who wrote (2516)	7/22/2023 10:51:59 AM
From: robert b furman	Read Replies (1) of 2591

Hi Elroy, There is a maintenance amount involved on the sale. I've never had any expense or cost. That being said I never have a margin expense, as I must have the cash to collateralize the sell order. Just a thing about put premiums in a down market - they swell up. If one was strapped for margin and the pt tripled - I'm not sure what would happen. I never sell a put unless I have the cash to buy the shares if assigned. I'm sure your account equity also covers it. For several years I've been selling puts on KMI. The market maker always blows up the ASK on a down market to ridiculous. This last week I had some $13.00 September puts. The Bid/ask was 1-17 cents. I also had some $15.00 and the bid ask was 3-5 cents. I guess the market maker is saying no way I'm covering that deep in the money put with my cash. Heaven help a guy if his account was maxed and the MM blows up the negative market value of the put. Not sure but it could cause a margin call. That happens on the $13.00's evey month I've sold them. Hope that helps, not sure I answered your question. Bob

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next