short naked puts at 5 on subprimes (NFI NEW)

Discussion in 'Options' started by scriabinop23, Mar 6, 2007.

  1. mnx


    I have a naked short put the @ 12.50 strike...

    never seen anything drop this sharply...

    I should really learn to avoid earnings announcements.

    #11     Mar 7, 2007
  2. thats a bummer
    #12     Mar 7, 2007
  3. mnx


    I knew my maximum loss would be $1250 (minus the credit i got) I never thought for a second that I'd reach 60% of it this quickly. ;)

    #13     Mar 7, 2007
  4. I've tried several times over the past couple weeks to trade buy-writes on NFI and NEW, and have never gotten filled even when my price is a few cents outside of the spread. At three different brokers, even. I wound up doing the legs as separate transactions and got reasonable fills.

    Refco is now RFXCQ.

    Herb Greenberg, always out to find the worst angle possible on any of the stocks in his hit list, noted that if NFI pays its dividend it will, ex-div, be a penny stock.
    #14     Mar 7, 2007
  5. Amazing how much volume today on the $2.50 March put strikes. We will obviously know for sure when verifying tomorrow, the OI to see how much of this was BTO/STO new positions today, but I suspect pretty much all of it, trading in a tight range of .15-.20. You really cant scalp in a nickel range when a stock is OTM by 50% and so close to expiration.

    What is interesting is how many contracts were written/sold today on the bid and in decent blocks. Just in the last 30 minutes, several blocks of 1000 contracts were hit on the bid at .15. Do you think pocketing $45K worth of premium is really worth taking a 7 trading risk like this??

    Update: bid ask now slipped to .10/.15 - someone took out all of the bids @ .15
    #15     Mar 7, 2007

  6. .15 for the march 2.50 puts....what are they 1.50 bid now?...cha ching.
    #16     Mar 13, 2007
  7. KS96


    my condolences
    #17     Mar 13, 2007