Question on Options play

Discussion in 'Options' started by Uncle_Ho, Apr 2, 2009.

  1. If I sell a naked OTM put in a far expiration say 10 puts in jan '10, and I buy a close expiration put say 30 puts in apr or may, am i protected against my far expiration shorts?
  2. The short answer in that scenario is yes you are until the longs expire anyway. There are a couple of variables to consider beyond the simple answer that depend on the strike prices and the current value of the stock, but generally you will be protected in the short term in the situation you have described.