Thanks. I meant more of the method behind actually placing the order.

I tried the following:

Action: Sell to open
Date: Aug 17
Strike:2.5
Call/Put: Put
Limit: 0.70

I get an error saying "You are attempting to open a covered put for a quantity greater than the short equity held"

I don't own any actual shares. (Merrill Edge)

Do you have cash in the account? You probably aren't approved for higher level trading options such as selling a naked put and need the $250 to cover the purchase if the shares are assigned to you.

Someone correct me if I'm wrong but that's what I had to do in my robinhood account since I think currently they don't even have the functionality to do naked options at all.

About $XX,000 of free cash. So yes

0708aggie said:

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About $XX,000 of free cash. So yes

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Might simply require a form

Yeah that's what it was. I had level 4 but needed level 5.

Ok. I'm approved. Do you agree that the above it the correct way to make this trade?

0708aggie said:

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Ok. I'm approved. Do you agree that the above it the correct way to make this trade?

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Yessir. That's the approach I used

Just sold 4 puts of BBOX at .70 at the recommended strike and expiration ($2.50 on 8/17).

First option I've ever traded. My V card is gone now. Let's see what happens.

So now I just sit and wait until it expires, right?

WestTexAg12 said:

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Just sold 4 puts of BBOX at .70 at the recommended strike and expiration ($2.50 on 8/17).

First option I've ever traded. My V card is gone now. Let's see what happens.

So now I just sit and wait until it expires, right?

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glad to know I'm not the only one feeling slightly lost. I understand the concept and read on it, now I'm giving it a go.. but I had the same question

tailgatetimer10 said:

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WestTexAg12 said:

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Just sold 4 puts of BBOX at .70 at the recommended strike and expiration ($2.50 on 8/17).

First option I've ever traded. My V card is gone now. Let's see what happens.

So now I just sit and wait until it expires, right?

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glad to know I'm not the only one feeling slightly lost. I understand the concept and read on it, now I'm giving it a go.. but I had the same question

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I saw your laugh emoji and first thought was "Ok, what did I F up here". Haha

I understand the simple concepts, just trying to make sense of the profitability, exercising rights, etc is scrambling my brain.

oldarmy1 said:

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Talon2DSO said:

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oldarmy1 said:

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IrishTxAggie said:

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Looks like BBOX is trying to get back into your $1.5-1.75 range.

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Sitting at the ask on $2.50 Puts

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I have no idea what this means

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Writing a $2.50 Put option out to August 20 for $1 means that whoever buys that pays me $1/share for the right to sell it to me for $2.50. It makes my net price $1.50 if I have to buy the shares for $2.50 OR if the shares are trading close or above $2.50 they won't trigger the option and I will have made $1/share.

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OA - love your posts and all the information - won't claim to understand but a fraction of it. I see the benefit to you for selling the put option out for $1 but what is the benefit (i.e., why) for the entity who purchased it.

It's a short. So by selling it you're "shorting" the short.

So if the stock drops, as the seller I have to buy the stock at 2.50 when the market is trading it at 1.50 (from a prospective as the buyer)

tailgatetimer10 said:

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It's a short. So by selling it you're "shorting" the short.

So if the stock drops, as the seller I have to buy the stock at 2.50 when the market is trading it at 1.50 (from a prospective as the buyer)

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Thanks - was being dense and not recognizing it as a short.

Takes all kinds to make a market.

RRTS is making a slow rise.

Also look at the call volume action on RDS A

AIG in the middle of a down wave but a lot of Call options bought. Too close to the money to be covered call action I think. Maybe bottoming out today or tomorrow.

FLEX volume alert. Trading it here looking for it to fill that nasty gap up at $16.55

We are either at a wave top or mid level wave on markets with the trend higher highs to come after higher lows on trend channel.

Trump have any tariff announcements planned?

oldarmy1 said:

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We are either at a wave top or mid level wave on markets with the trend higher highs to come after higher lows on trend channel.

Trump have any tariff announcements planned?

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He did just arrive in England and Brexit is on the discussion topic.

oldarmy1 said:

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FLEX volume alert. Trading it here looking for it to fill that nasty gap up at $16.55

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FLEX hits $15 I say it will get you $16.50. Safe way to trade it.

today was a good day, had to chase some fills on options

what I would ask of Bad Trump...


:braveheart-HOLD.gif:

oldarmy1 said:

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RRTS is making a slow rise.

Also look at the call volume action on RDS A

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What does that suggest the stock will do in the near future? I sold off some of my position when it hit $73 last time and will probably do the same if it gets there again...

Traveling so no trades today. All the green means my puts are making money. Some expire tomorrow. My covered calls are ITM now though.

Do you hold a lot of puts until close to expiration? It seems that would make your returns more volatile and eat up buying power for a potential smaller remaining return relative to the risk.

I know Tastytrade advocates rolling or closing with around 21 DTE, but I was just curious how you generally approached it.

IrishTxAggie said:

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oldarmy1 said:

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We are either at a wave top or mid level wave on markets with the trend higher highs to come after higher lows on trend channel.

Trump have any tariff announcements planned?

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He did just arrive in England and Brexit is on the discussion topic.

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Trump just shat all over Prime Minster May and the overall Brexit plan shes crafted.

Not surprised. Her plan still had them basically entrenched in the EU.

oldarmy1 said:

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Takes all kinds to make a market.

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Yep, and it takes all kinds to make a good go of a poker game.

Vito said:

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Do you hold a lot of puts until close to expiration? It seems that would make your returns more volatile and eat up buying power for a potential smaller remaining return relative to the risk.

I know Tastytrade advocates rolling or closing with around 21 DTE, but I was just curious how you generally approached it.

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they say to close winners at 50% profit, it just depends. Sometimes it takes longer to get to that point and then you might as well wait and get to 100% profit.

https://seekingalpha.com/article/4186449-black-box-ceo-joel-trammell-making-bold-promotional-statements-interviews

That article and CEO are pretty aggressive in their statements. How high do you see BBOX going over the next year?

He has a great track record so BBOX is like betting on the horse. Mondays earnings will be poor. That is expected but the shares might still take a hit. However, he will give more detail on the initial deal struck and forward looking statements will be positive.

So just how much short term volitilaty occurs while waiting for the "proof" quarter. There are multiple triggers to send the stock higher.
They close on that unit sale in August and the aggressive statements suddenly have validation.

Goal should be to trade this into a net free position so we aren't risk exposed. The stock could do anything from collapse, if he fails to execute his strategy, all the way to one of those $50 dream recoveries, based on realizing anything remotely close to the $300m stated potential of that one relationship.

And the small float means it will be a wild ride

RRTS has a flag pattern. Will be watching to see if it can initially push above $2.75 and then move to $3 on that pattern.

I am giving you guys my very early accumulation approach to these stocks. If you can't sleep at night because of the ups and downs of initial cycle reversals then ignore these type of stocks.

We hit $4 on RRTS my next move would he selling covered calls on 25-30%.

Thanks. I have some $2.50 9/21 calls on BBOX and it looks like I'll be selling them today. With the earnings and the expectation that it won't be 'pretty' I feel I can pick them back up later for cheaper.

A lot of manipulation attempts going on with BBOX. Check this garbage out. I went to their site to see more on their gap down alert and it said $1.95 gap down this morning?

The options price has taken a hit... Not selling them yet. Guess I'll see what it's like in a few hours