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re: Can you sell calls to establish a short position?
Posted on 7/10/16 at 4:45 pm to dabigfella
Posted on 7/10/16 at 4:45 pm to dabigfella
quote:
That's what I was asking, is it like selling puts as in I wake up Saturday morning with a short position? That's what I wanted
Selling a put "obligates" you to buy shares IF "put" is exercised.
I've done put selling for a long time. I use it to enter a position. Sometimes the put expires worthless, but I get the premium. sometimes I have to buy shares, but I get them at less than the strike which I would have bought at the strike price anyway.
I have not bought calls, but if you are bullish that can work.
Selling naked calls is too risky for me. You have no limit on how high the price might go.
Posted on 7/10/16 at 7:28 pm to makersmark1
Again totally understand your concerns on unlimited losses but that's not my concern. The spy is the the entire us market and it's so disconnected from the data at this point that the upside is possibly less than 5% and the downside is 25% or more tops. That sounds like the kind of trade I want to be putting on. The economy has to run literally perfectly at this point to burn me even 10% on the trade from here and I highly doubt that happens.. I too sell puts to get in where I want and was asking if selling naked calls is the same as in I get to dictate the level I enter my position at but with calls on the short side of things
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