@7out, thanks for the explanation. Yes, your calc is correct. Here one can analyze the 1st case further graphically: https://www.optioncreator.com/stcwpv7 You can fill-in the Premium field, it will calc the IV.
I think you can improve both the risk as well the profit to your favor by selling 2x calls. Check this: https://www.optioncreator.com/stiyarg In this case your profit zone is much wider (it enters the loss zone only if the stock falls below 2.60, which of course is very unrealistic from the current 7.9 to 9.30 range).
I doubt our account will allow short naked calls, but in any case I feel more confident in this stock rising than dropping (hence my initial interest in this stock).
Yeah, for this you would need a margin account instead of the normal cash acct. Ok, I hadn't analyzed that stock regarding recent developments and direction, you surely have more insight in it.
He did! Just the synthetic version: Long Stock + Short Call = Short Put More info: https://www.theoptionsguide.com/synthetic-short-put.aspx
I entered into some $6/$4 vertical put credit spreads this morning. Collected an average of $75.80 per contract.
Don't see the point in buying/covering the $4 put, CRBP is sitting on $121MM in cash (if you researched it).
Is it something like this? : https://www.optioncreator.com/st7n8ni It has no risk, but the profit potential is also limited.
Broker requires 100% margin on that stock for naked options which actually makes my returns lower. Instead of getting $1.25 for putting up $600 with 1 naked put, I can get 3 credit spreads for $.75 each collecting $2.25 while still only putting up the same $600 because the margin is only $200 per credit spread. So that's why I do it that way. So I make 80% more money. Hope that clears it up.