re: Can you sell calls to establish a short position?

quote:

---

Edit - And your naked trade is down 79% at open. What you collect .23-.79 for, now needs to be bought back for $1.73. Or if exercised, you'd need to buy 500 shares of SPY @ 214.86, and sell 500 shares at 213.50. You are left holding nothing. No short position. 

---

I don't claim to be an expert but this doesn't make a lick of sense. I had a call spread I was short earlier this year. I don't remember exact strike prices but let's say 210 and 213. I was short 3 contracts at 210 and bought 3 long at 213. Trade moved against me and the 210 were assigned but the 213 were not in the money. I woke up short 300 shares of SPY which is exactly what bigfella wanted...

I ended up buying back to close the trade at a better price cuz SPY tanked that day after a big up day before but that's irrelevant. You sell a call that gets assigned you are now short shares. You don't buy shares and then short unless you want to close the position out.

I feel like you are unnecessarily scaring people away from the trade. No it's not the best method due to potential losses but bigfella isn't some small investor... his margin more than covers a 5 contract trade if that's how he wants to play it.