– Glossary

Put Writing (or “Put Selling”) -

A strategy that involves selling a put, which places upon the seller the obligation to buy the shares at the strike price if the put is exercised. Put writers typically sell puts below the market, as an effort to either acquire a stock at a price below current market prices or get paid while they wait by pocketing the option premium should the put expire worthless. Put writers should be willing to own the stocks they sell puts on, as they are incurring the obligation to buy the stock at a certain price up until that option´ s expiration.

« Back

CLOSE
CLOSE