Hacker News
new
|
past
|
comments
|
ask
|
show
|
jobs
|
submit
login
coolgeek
on April 23, 2011
|
parent
|
context
|
favorite
| on:
Amazon’s $23,698,655.93 book about flies
It is in fact how naked puts work
http://en.wikipedia.org/wiki/Naked_put
eru
on April 23, 2011
[–]
Aren't you talking about naked calls (
http://en.wikipedia.org/wiki/Naked_call
)?
coolgeek
on April 24, 2011
|
parent
[–]
Them too. Both involve "selling something you don't own" (the underlying security), a point disputed in the post I was replying to.
eru
on April 25, 2011
|
root
|
parent
[–]
I don't see how writing naked puts involves selling. They involve buying, only.
Snurre
on April 26, 2011
|
root
|
parent
[–]
All buying involve the counterpart selling. How can you buy something that isn't sold?
eru
on April 26, 2011
|
root
|
parent
[–]
Oh, but in naked puts the seller of the underlying assets (i.e. the buyer of the put) calls the shots. If they don't want to sell, they don't have to sell. And the writer of the put only ever has to put up at most the strike price of the put.
So no unlimited risks there.
Guidelines
|
FAQ
|
Lists
|
API
|
Security
|
Legal
|
Apply to YC
|
Contact
Search:
http://en.wikipedia.org/wiki/Naked_put