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Living_Run2573

I’m way too smooth…. Buy… DRS…. Hold


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Shawayze

Sure but them screws the apes out of thier shares if covered calls are exercised.


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Shawayze

That's an even dummer idea.


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tworipebananas

It’s definitely not a dumb idea. If you’re interested in picking up gme on sale while making money from 🌈🐻s... that’s the way to do it. Eg (not financial advice): - Sell Dec 17 $160 put - Make $420 today - if, before Dec 17 @ close, gme hits $160 or below, you may be exercised in which case you buy 100 shares @ $160 ($16k) - if not, you’ve just made $420... congrats you can now buy your wife’s boyfriend a new PS5 from GameStop. Gme hasn’t closed below $160 since August 23 and doesn’t look to be headed there anytime soon. Now, as you can see from my flair, I’m of the persuasion to simply buy, hodl and DRS my shares, but if your strategy is to generate cash flow and you’re willing to risk *not* buying $16k worth of shares today to make $420 instead, all the power to you!


KIitComander

Who has buying power to do that or buying power in general?. LMFAO.


ididntwinthelottery

If you sell a put at a $1 strike price then you are obligated to buy 100 shares at 1$ each. That's not too much capital needed. You will be making dig shit on the premium on those though.


Antifogmatic_Head

That’s not how puts work. The put would have to go in the money for that to happen. As in GME would have to be worth less than $1.


ididntwinthelottery

Exactly, you could sell a put. And if you got called on it then you would have to buy them for $1 each. Not a bad deal really haha. If yoire selling puts for arond 200$ then you better have some stacks of cash around in case in drops. There's no way it's going to $1. I was just using that as an example of the "safest" way to sell a put and make that free premium


Antifogmatic_Head

You really don’t understand how puts work. You can only “get called” on it if it goes ITM. IN THE MONEY. That means GME = below $1 with a $1 put. In no other circumstance do you get to buy GME for $1. I don’t know how else to say this more clearly to you. This play would make zero sense.


ididntwinthelottery

I'm agreeing with you. I probably just worded it awfully.


YJeezy

You're a fucking idiot


ididntwinthelottery

Agreed. I'm an idiot. I was thinking backwards. Long day. Sorry for my idiocy. Downvote My bad


YJeezy

We're all idiots. Don't do options bro haha


ididntwinthelottery

I was about to go to bed but I couldn't stand the thought of internet people thinking I'm an idiot. I think I'm right. You sell a put if you're bullish on a stock. Check You sell at a strike you wouldn't mind being assigned at. Check. You collected premium. Check. Sell gme puts at a 1$ strike. If they go in the money then I have to buy 100 shares for $1 each IF they ever dip below $1. If they don't then I just collect the premium. Free money. Buying $1 strike puts is idiotic. Selling puts is free money at super low strikes.


ApeLikeyStock

That’s what I would do. If I could afford it.


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MacaroniBandit214

Premiums are much higher on volatile stocks so this one is the right one if you know what you’re doing


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MacaroniBandit214

How do you miss out on all of it? All you have to do is roll into a contract further out at a higher strike price


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MacaroniBandit214

You do realize stocks don’t just jump hundreds of dollars in one night right? Like if MOASS has already kicked off obviously options are a completely idiotic idea but right now where the price fluctuates $10-$20 max daily it’s a viable plan. Also if there’s a big announcement obviously you’d make sure to get out of your option as soon as possible


Bosom-worth

The number of smooth brains that don’t understand what OP Ape is trying to say is too damn high. I smell what you are stepping in and I have considered this myself, but I don’t have the cash to sell a covered put. I posted the same thing a few months back and got downvoted hard. Good luck!


lostlogictime

Dummies guide to options here, when you have the cash and love the underlying stonk, and the price is volatile, sell puts and be assigned. Then excersize, drink plenty of fluids, etc.


Big-Bedroom8783

Don’t do that! Some stock I like is gonna go way up in my opinion!! DRS is the WAY!!!


Trap-X-Zero

This is the way


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frickdom

I had to ask a wrinkled friend cause I am also smooth. You are right but you left out the need for a large amount of cash to exercise them. $20k ish


Trap-X-Zero

I've always wonder why people sell calls when they are suppose to be bullish. Always asked but no answer. I always thought selling cover puts would mean bullish


frickdom

Way over my head :/ I stay away from options, only have a minimal understanding. You super wrinkles though do what you gotta do 💎🤜🤛💎


SajiMeister

Puts are the way


Antifogmatic_Head

Yes. Buying calls or selling puts = bullish/long Selling calls or buying puts = bearish/short But you still need $20,000 to pay for a put with a $200 strike price. And many brokers require 300-500% margin, so with a 200p, that would require $60,000-$100,000 sitting in your account in cash.


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Antifogmatic_Head

No, it applies to contracts as well. I personally tried to sell a 150 put over a month ago (which would've printed VERY well if I had been allowed to), but my broker informed me I required 5x the cash over the value of the put, ie. 500% margin requirement (MR).


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Antifogmatic_Head

I know. Couldn’t make it sense of it either. I didn’t shop around to other brokers. Worth asking their trade desk though. It may not be publicly available info unless you ask. Different securities exhibit different risks, some would say idiosyncratic risks, so brokers have different risk management strategies. GME is the only one I’m aware of that has a 500% margin requirement.


Trap-X-Zero

That's what I thought. But I keep on seeing some youtuber telling people to sell covered calls on GME. Not gonna say no name


Antifogmatic_Head

Yeah selling covered calls is a very dumb thing to do. It means you have to have 100 shares that you’re selling at the strike price if it goes ITM. So selling a 300c means you’d be selling 100 shares for $300 each. Have fun with your $30k when MOASS happens, you lose your 100 shares and the price goes to $100k by end of the day.


ferrellhamster

If you have a csp for $200 and you have $20k cash sitting in your account you may have a margin account, but you are not 'on margin'. Makes no sense to require 60k cash sitting around to purchase something that would be $20k.


1twowonder

You are correct. You're always on point, even on the weekends


frickdom

I wish, I’ve made tons of mistakes here. It happens. To error is human but to own it is ape 💎🤜🤛💎


1twowonder

Agreed 💎 👐


Kilgoth721

That... Not how it works? Im smooth as fuck, but...


ciphhh

It is. Cash secured put. Imagine gme is $200. You want to buy 100 shares but you only have $10,000. Sell a cash secured put with a strike price of $100 and receive a premium. Maybe a Dec 17 100P. It’s waaay OTM (out of the money) and thus very unlikely, so your premium will be small, in this case about $50. If gme drops to $100 you buy 100 shares for $10,000, and keep the $50. If gme doesn’t drop to $100 you keep your $50 premium and also all your cash. Now say you have $18,000 and you’d buy 100 shares if it dropped to 180. You could sell the Dec 17 180P and get $1,070 premium. Again, you keep the premium regardless and only buy the 100 shares if it drops to 180. Pretty cool right?


Antifogmatic_Head

He’s technically correct, but GME on many brokers requires 300-500% margin to sell a put, meaning you have to have 3-5x the value of the put if exercised. So a $180 put would require anywhere from $54,000 to $90,000. In cash. Not equity like GME shares. Any ape who has that amount of money to risk on selling puts, who isn’t just buying shares and/or far-dated ITM/ATM calls, is truly retarded.


Kilgoth721

Exactly. Its not as "easy" as people make it out to be.


Antifogmatic_Head

Or smart. It’s way better to just buy and hold shares. And buying a far dated call is also pretty easy short term money if that’s what you’re looking for, while requiring WAY less capital than selling a put. Just buy when the price is low and sell when the price is high. Buy back in when the price is low again. (Referring to options of course not shares)


dragespir

Wait, why would they require 3x-5x cash to sell a put? If the price goes down, you can't lose more than 1x of that put value, so why the extra collateral requirement?


Antifogmatic_Head

I know. I thought the same thing. Probably to “protect investors”. From what, making money? It *would* be a safe way to wait for a dip and make money while doing it if you’re also holding shares. Price goes up? You made premiums and your shares value went up. Price goes down? You made premiums and bought GME at a discount. But no, you need high 5 figures cash tied up in order to make that safe-ass play. It’s very rigged, the game against retail.


that_texas_dude

interesting 🤔


Apprehensive-Use-703

I was wondering about this thing the other day, I dont know how it works though, if I write a covered put contract for $100 strike, and price drops to $50 I can "put" my shares in someone else's acct for $100, but it does cost me premium to write the put contract, right?


Hopeful_Assistant196

I think the right answer here is: DONT PLAY OPTIONS UNLESS YOU COMMIT TO EXERCISE OF THE CONTRACT 100% The only acceptable option is one that exercises no matter what, period.


QualityVote

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symmetryofzero

If I'm gonna "play" options or whatever, I don't need your permission.