1. Put-Optionen
Was ist der Vorteil von put selling?
Trader's Corner
This month's Trader's Corner examines the benefits of put selling. Listed below are a number of hints to help you maximize the power of this strategy that allows you to pocket your premiums.
As a brief review.
- Our put selling strategy involves selling an out-of-the-money put on a stock that you would be willing to buy as your own if the stock took a temporary plunge.
- As a put seller, you are neutral to bullish on the stock and your goal is for the stock price to remain above the put's strike price.
- Most of the time the put will expire worthless, allowing the investor to pocket the premium and receive a 10- to 20-percent profit without ever having to buy the stock.
- Another benefit for the put seller is that there is no commission cost to exit a winning trade when the option expires worthless.
Here are some points to keep in mind before jumping into put selling:
If you can't afford to buy all the underlying stock that you could be obligated to buy.
under the put contracts that you sell, you should either reduce your put-selling exposure to an affordable level or avoid the strategy altogether.
Also, since assignment will inevitably occur on some of your positions, make sure that the underlying stock is one that you would have no qualms about owning.
Do not get enticed by the higher option premiums that more volatile stocks command, without having a sense for the stock's short-term direction.
Higher premiums usually mean higher expected volatility and declines could be drastic, which could corner you into a steep losing position.
We prefer to trade out-of-the-money puts.
With out-of-the money puts, because the risk of assignment is much less, they require smaller initial margins, and their premiums deteriorate at an accelerating rate as the options approach expiration.
Also, out-of-the-money put sellers can fully benefit from a flat or slightly lower move in the stock.
Pick a strike price for an out-of-the- money put sale that is close to a significant support level.
In the event that the stock moves slightly in the money near expiration and you are assigned, you could benefit from an immediate technical rebound in the stock.
Focus on options with one to three months until expiration.
This is for two primary reasons:
- Because the option-pricing model assumes that price movement is random, the premium per unit of time increases as the length of time to expiration decreases. Thus, the put seller gets more "bang for the buck" with short-term options.
- The rate of time decay increases as the time to expiration decreases. Time decay works in favor of option sellers, and the accelerated time decay of short-term puts works best.
Finally, your assessment of the underlying stock is the most critical factor.
Selecting an optimal option strategy is no substitute for successfully gauging the future movement of the underlying stock.
- Focus on stocks in a strong uptrend that are relative-strength leaders, have mild to low expectations, and that have relatively little vulnerability to major "event risk" (such as a violent reaction to an earning surprise).
- Remember that a put seller benefits far less from a major rally in the stock relative to what can be lost in a major decline.
The most critical concept to remember with put selling is.
Your reward is limited to the premium collected. The downside risk increases with each decline below the breakeven point before or after the stock is put to you.
However, if you're prepared and willing to own the stock and can live with smaller, more consistent profits, put selling is a wonderful addition to your options arsenal.
Does put selling sound like a strategy for you? If you'd like to add more consistent profits to your portfolio, have an expert market timer on your side to help find put selling opportunities for you. Bernie Schaeffer provides put selling recommendations monthly in his Option Advisor newsletter (click here), and also in a real-time alert service in Schaeffer's Blue Chip Option Writer Series (click here).
