For a year? With American exercise options? Maybe trading TLT or ZROZ outright really is the lesser evil?
Spx box would be European. But OP did write Apple. I kind of understand the structure and the use case, but never used it as my style doesn't require so much margin. Then, for reg-t at least, I think the extra margin only becomes available on the same instrument. But I might be wrong.
Thanks for the info. The position is delta neutral as long as Apple is below $390 If I sell a call, I have to buy the stock, it's the opposite position. The account is no longer in credit but in debit.
As @newwurldmn pointed out, selling a call naked is synthetically the exact same position as selling the stock and selling a put (of the same strike). It's not the opposite position. Say you short the stock at 400 and sell the 400 put. At expiration if below 400 you are assigned on your short put and end up with no position. If above 400 you are not assigned and have short stock By selling the 400 call naked, at expiration if below 400 you are not assigned and have no position. If above 400 you are assigned and have short stock. Exactly the same. In fact, you will probably be better off just shorting the call. If you short stock as a retail customer, you probably won't get the same interest rate that would be implied in the short call.
The purpose of the trade is to have liquidity. You are not reading the messages. The put sold is itm at 390 and not at the strike price. If I sell the call at 400 for January 2026, I collect $40 This has nothing to do with selling the stock short and a put itm.
You are not understanding. I gave the 400 call as an example. What I am trying to explain to you is if you sell a put and short the stock, it is the same as simply selling a call of the same strike. Doesn't matter if its ITM or not. If you sold a 390 put and shorted stock, its the same as simply selling the 390 call naked.
yes it's the same thing in terms of trading. But in my case, I have more than $50,000 in the credit of my account with an interest of $0.25 per year. If the appl stock remains below $390 for 1 year, I keep my credit. After a year, the position will close because I will be assigned on the put. And the credit will disappear.
the interest rate you think you are arbing is priced into the option at the wholesale rate (you don’t get the wholesale rate). So you will be arbing yourself. A cleaner way is to trade an SPX BOX.