Options math 101 - Net returns from an unexercised put

I find Greeks much more confusing!

 

10% using your calculation is where I am getting at across my watchlist!
It seems to be a reference in the market.

 

Wait till your broker actually shows you negative equity for selling puts or calls (taking on risk).
Today Interactive Brokers wants to give me negative -$12,456 margin/equity, just for selling 5 naked calls on SPX:


They'd lock me in a psych ward if I'd try to calculate my ROE or even ROI on this

 

This is just the premium amount.
Margin is calculated according to rules on this website:
https://www.interactivebrokers.co.uk/en/index.php?f=37725#margin-matrix

 

Try this, see what happens...

@destriero

*runs behind a bunker*

 

My question is not that much 101 after all!
Options have such a bad reputation and making simple components such as what I am raising here so murky does not help!

 

Not murky, but multi-faceted. Options traders can definitely be accused of mental masturbation.

Here is the bottom line:

If you were to fund an account and be able to do this one trade, all you would have to put up is 50,147 to enter the trade. Without it, your order will be rejected.

That is the initial equity for your calculation.

 

Yes.