Originally Posted by
mispoken
love the idea; selling the Jan $3050 is great but it takes up so much buying power, I’d probably buy the $2900 long put. This spread yields $3k in premium.
Selling the $3050 uses $300k in buying power. Selling the 2900/3050 uses $12k in buying power.
$5k in premium for $300k buying power usage or $3k for $12k in buying power? It’s a personal choice, but I do strive for some semblance of an efficient use of capital and premium vs buying power usage.
OK. you make a compelling argument. At what point do you close out of the 2900 option? With your spread, you could sell.... what.... carry the one.... ummmm... 25 of those and net $75K in premiums... for the same $300K. am I reading that right?