FreeBaGeL
Footballguy
What did you sell the puts at?I am confused. Sorry. I have never dabbled in options until NERV. Not sure I will again for awhile as I need to gather a better education of these before I do. But right now my line looks like this.
NERV 5.00 PUT
JUN 19, 2020
5 shares
2.50 last
+ 1.50 change
$597.30 total g/L
$1,250.00 MKT value
Can anyone explain. Can I sell? Should I? Sorry for my lack of knowledge and I appreciate everyone's input here.
Assuming it was around $1.20 that would mean you're in for a credit of 1.2 x 100 x 5 = $600. So someone paid you $600 for those puts and you have that money in your account.
If you want to get out of the position you'd need to buy them back which would cost 2.5 * 100 * 5 = $1250. So your total net on the trade would be $600 - $1250 = $650 loss.
Alternatively if you hold them, and the price goes up above $5 on June 19, the puts expire worthless and you keep the $600 as your profit.
If you hold and the price doesn't go above $5, you now own 500 shares at a cost of $5 each ($2500 total) and you have your $600 premium still. From there you can either hold the shares and hope they go back up eventually or sell them at a loss.
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