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Stock traded on NYSE,recent quote is $200/share.
if I have sold a naked call ,strike price $210 ,expiration JAN 2025,how should I hedge ?
Thanks in advance
Stock traded on NYSE,recent quote is $200/share.
if I have sold a naked call ,strike price $210 ,expiration JAN 2025,how should I hedge ?
Thanks in advance
OK let's think about this one.
Your risk is a runaway stock price to the upside.
Therefore you would want to maybe buy some shares of a 2x or 3x bullish ticker in the same industry?
thanks for your response,but this stock is rather unusual ,it has very narrow float and unlike other companies in its industry.
1.Should I sell a naked put $200 for the same month,same year ?
2.Should I sell a naked put $190 for the preceding month,say December 2023?
3.Should I buy a call at a slightly higher strike price?say $210? expiring Jan,2024?
with #3,if price goes to $250,my loss would be
the $210 call premium minus the $200 call premium .
Not much to gain ??
Or watch it during the 18 months prior to expiration and see if I can close the call option at a gain,or actually take a position in the stock when it hits a low price?
Stock traded on NYSE,recent quote is $200/share.
if I have sold a naked call ,strike price $210 ,expiration JAN 2025,how should I hedge ?
Thanks in advance
Pretty risky to do naked anything.....
You could do a vertical spread selling the 210 and buying a higher strike such as the 220. The only naked option I would even consider is selling a put on an equity I want to own. Of course, it would not be a true "naked" option but rather a cash-secured put.
Pretty risky to do naked anything.....
You could do a vertical spread selling the 210 and buying a higher strike such as the 220. The only naked option I would even consider is selling a put on an equity I want to own. Of course, it would not be a true "naked" option but rather a cash-secured put.
A lot of your questions regarding options can be answered by playing around on a good options trading platform. I use "Think or swim" from TD Ameritrade.
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