I'm trying to understand the math of selling ES mini futures options. I'm a novice on options & futures in general, so please bear with me. Say I sold a naked sept07 put (1400 strike) on the ES, which is roughly 65pts below the underlying. According to IB it's currently trading at 16.75. Does that mean that if I sold one contract I would only get $16.75 cash for it, even though its value tracks the underlying futures (i.e., a one point movement is equal to $50)? If not, how much cash would I get? Also, say the ES takes a dive and moves down to 1390. If the buyer exercises that means I'm out $500, correct? Also, if the ES instead drops 35 points to 1430 and I get nervous and decide to buy back the option, and say it's trading now at 26.75, or 10 points above what I sold it for, does that mean I'm likewise taking a $500 hit? If that's truly how the math works out, the risk reward ratio of selling mini futures options looks horrendous. Any insight would be greatly appreciated!