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re: Dedicated Short / Put Thread
Posted on 4/16/21 at 11:45 am to Chucktown_Badger
Posted on 4/16/21 at 11:45 am to Chucktown_Badger
It’s a negative 1 because you sold the option, so you’re short the option.
You can buy it back whenever you want, but you only get the full premium if you hold to expiry and the option is out of the money or if it becomes so out of the money before expiry that you can buy back at 0 before then.
You did get the 25 premium immediately, but you only keep the full premium if the option price subsequently goes to 0. Otherwise, you only collect the difference.
You can buy it back whenever you want, but you only get the full premium if you hold to expiry and the option is out of the money or if it becomes so out of the money before expiry that you can buy back at 0 before then.
You did get the 25 premium immediately, but you only keep the full premium if the option price subsequently goes to 0. Otherwise, you only collect the difference.
This post was edited on 4/16/21 at 1:01 pm
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