Originally Posted by
Schwanker
Same question I guess. Why not sell puts assuming you have the assets to cover vs the LEAP?
For a LEAP Call on BABA I only need $6000ish. I'm simply making an equity substitution and applying leverage. If I'm selling a Put to generate the same type of return it will require significant Margin in case the price goes against and the buyer decides to exercise the option early. Combine those risk factors with short term capital gains on premiums, selling Puts is more of a hedging strategy and not optimal use of capital for the long term investor
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