I probably should know the answer to these questions, but I don't. Perhaps it's a "brain cloud" thing... Anyway, say I sold a 500/495 XYZ Bull Put Spread when XYZ was at $503. Then XYZ falls and the stock price is currently 492. Now the Buyer of my XYZ 500 Put decides to sell his Put for a profit. Does my Spread fall apart? Probably not, so is the new owner of the 500 XYZ Put now on the other side of my trade? Does that 500 XYZ Put have a Spread ID number, so the current owner is always involved in my Spread? Am I informed when the owner of that particular Put becomes someone else?
no, it's out there on the open market and can change hands many times but if you're curious, just announce it when you do it, and if the ul falls to 492, someone on ET will brag that they took the other side (you won't know who until it goes in the money for them.)
I've read conflicting info about Options Contracts and CUSIP and ISIN numbers. Does each Options Contract have one or both of these numbers so it can be traced?
Where is the actual Put? Is it a piece of paper in a safe, like the old stock certificates? Or is it totally electronic? Are the current Buyers and Sellers names and/or account numbers on it? It is a contract so it must be filed somewhere, no?
yes, that's why nowadays, to get a job at the Options Clearing house, you have to pass a physical to prove you can lift 80 lbs over your head. Due to increased volume, those certificates get really heavy. also, on your memory test, try to fail, they won't hire you if they think you can remember the combination to the safe. It use to be a nice little job, you knew everybody in the office and you just filed things away. Now when somebody sells a put, it's like looking for something at Home Depot. If you are a really big client they have a special box they put all the certificates in. That way if you change your mind, they don't have to look all over the whole warehouse for it. That's why I only trade one lots. When I call them up to close it out I just say, "Look in the small potato bin, that's where my trades always are."
All electronic. It's a contract you consented to when your broker bought/sold it and really only exists as a database record at the OCC. Please see a text on exchange traded derivatives for more info. What you are describing is something like an OTC option traded under an ISDA contract between two institutions, not an exchange traded option.