I did the beacboad workout this am with my wife. The little instructor is easy on the eyes

SINO offering $28.5M in shares at market value. This can create an opening for positioning. Maybe in the $6 area?

Challenger 17 said:

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Bob Knights Liver said:

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Selling puts mean you buy if they execute. So if it expires below $20 you end up buying it for $8.5/share. But for now out pocket the premium.

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Sorry I should clarify I own the underlying shares already. It would be a covered PUT.

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Selling the Put option gives the buyer the right to sell you the shares at $20. So if it's under $20 you're buying an additional 100 shares for every put contract you sell. I think you're getting it confused with how a covered call works.

oldarmy1 said:

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SINO offering $28.5M in shares at market value. This can create an opening for positioning. Maybe in the $6 area?

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Of course I bought in yesterday

McInnis 03 said:

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On topic

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That much sooner we need to get positioned in some of these low key high potential plays.

more on topic:

When I open my super duper fantastic stock info and trading service, I'll call it McFly's Information Aggregation and Trading Assistance Service. MIATAS for short, because what's better than a girly car with two doors and a removable top?

Challenger 17 said:

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Bob Knights Liver said:

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Selling puts mean you buy if they execute. So if it expires below $20 you end up buying it for $8.5/share. But for now out pocket the premium.

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Sorry I should clarify I own the underlying shares already. It would be a covered PUT.

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You seem to be confusing calls and puts.

The only "covered" put is a cash-covered put, meaning you have enough cash on hand to make the purchase of the equity at the strike price you sold the put for - in the case of a $20 WWR put, it means you'd need $2000 to "cover" the put. For cash-only accounts, brokers will actually lock down your cash so you can't spend it on other transactions and get yourself in trouble. For margin accounts, you'll have to either keep track of that yourself, or accept the risk of a naked put.

If you own a stock and sell a put, that has zero bearing on the shares you own. Anytime you sell a put, you're agreeing to buy 100 more shares if the stock price falls below the strike price of your put. So in your case, if you own WWR and sell a put for WWR, if means you'll potentially have to buy more WWR... your current shares of WWR are unaffected by a sold put.

The only direct relationship a put has with shares you own is if you buy a put as a protective hedge... meaning you get to sell for a guaranteed price if it falls below that price.

AgEE10 said:

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Challenger 17 said:

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Bob Knights Liver said:

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Selling puts mean you buy if they execute. So if it expires below $20 you end up buying it for $8.5/share. But for now out pocket the premium.

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Sorry I should clarify I own the underlying shares already. It would be a covered PUT.

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Selling the Put option gives the buyer the right to sell you the shares at $20. So if it's under $20 you're buying an additional 100 shares for every put contract you sell. I think you're getting it confused with how a covered call works.

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Yes even if you own shares already, you'll still have to purchase if a sold put gets called out.

Speaking of getting called out - how about that math I did there? $20 - $12.5 = $8.50? Wow.