heh I had a 70% drawdown on my SPY 130 put. but my break-even was SPY 115 Better than buying SPY at 134 at the time I sold the puts. I wonder though how a hedge fund would fare if they sold the same puts and were heavily leveraged. I sell puts instead of naked buying of stock. seems safer.
SPY looks set to open at 114 this morning. Been selling off hard the last hour. Hedge funds are rarely "heavily leveraged" in naked option plays.
Nope...strickly for the premium income. A rampant bull market makes this a great strategy. His big problem was going "naked".....he refused to buy the OTM puts to cap his losses. When the market swooned (like it is doing now), he lost his shirt....literally overnight.