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Re: GE kicked out of DJIA?
[Re: keets]
#6264245
06/21/18 09:46 AM
06/21/18 09:46 AM
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Joined: Dec 2011
Posts: 10,436 MT
snowy
trapper
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trapper
Joined: Dec 2011
Posts: 10,436
MT
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The future of GE and markets is an unknown and those shares you are buying COULD pay big time but who knows. Markets are all a gamble but the one thing to that is important is to buy and hold and don't look back remember you have to be in for the LONG haul.
Give me a fish, I will eat for a day. Teach me to fish, I will eat for a lifetime
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Re: GE kicked out of DJIA?
[Re: keets]
#6264303
06/21/18 11:48 AM
06/21/18 11:48 AM
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Joined: Mar 2007
Posts: 35,183 McGrath, AK
white17
"General (Mr.Sunshine) Washington"
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"General (Mr.Sunshine) Washington"
Joined: Mar 2007
Posts: 35,183
McGrath, AK
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If I am the put seller....I have the obligation to buy your shares at price X regardless of the stock price. Yes,, I keep the premium regardless. So If I sold you a put contract that expires december 21st, 2018, with a strike price of 12.00.............you would pay me $72 today.
So if the price of GE shares was 12.00 or lower you could exercise your contract and I pay you 12$ a share. My EFFECTIVE price would be $11.28 per share because I have already collected .72 per share from you when you bought the contract.
If the stock price rises...I still keep the premium and the contract expires worthless on December 21, 2018. At that point I could sell another contract if I chose to.
You are essentially buying insurance from me.
No. I do NOT have a stake or a position in the security in order to sell the put. I MAY be trying to establish a position by selling the put. I would be willing to buy shares but only at a lower price than they are currently trading. On the other hand, I may just be looking for a way to make some income by selling puts that I believe will expire worthless at expiration....due to stock price being above the strike price of the contract.
Mean As Nails
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