Selling A Put Vs Buying A Put at Buying

Selling A Put Vs Buying A Put. If you sold the put to open the trade, then you will buy the put at the current market price to close it. You sell the put for a profit once price has fallen.

For example, when you buy a call option, you open a long position and profits are realized from price appreciation. For example, let’s say you wanted to make a quick trade in vxx. Let us first see what selling a call option means.

Trader wants to own 100 shares of yhoo if price goes down to $49. Selling this put allows an investor to commit to buying v stock at an effective price of 171.50 (175.00 — 3.50) and to earn approximately 2% income for the 48 days that the cash is. If you buy a put, you assume a bearish stance, with gains banked from falling asset prices. Rights and obligations are different, and that is precisely wh.