Married Puts

Discussion in 'Trading' started by bigbear, Jun 19, 2003.

  1. bigbear


    haven't been using many lately but got an easy question about them.

    How exactly are they comprised? Don could probably give me the best explanation. But anyone who wants to help - thanks ahead of time.

    Firm buys stock and ???????
  2. Actually you may want to read the transcpript of the last Chat from a week ago. We went into detail.

    But (short version). We, as traders, simply buy a contract that consists of long stock and a put option. The option is automatically exercised after the close of trading that day, thus "putting" the stock back. In the meantime, we can sell the long stock and buy it back several times during the day.

    Hope this helps!!