who sells those dime puts?

Discussion in 'Options' started by ghettotrade, Feb 14, 2011.

  1. I bots me those dime puts for insurance from goldman sacks but why would anyone sell puts for a dime especially april puts?

    risk all that money to make 10 dollars?

    sounds stupid.
  2. Maverick74


    How do you know they weren't long them?
  3. rdg


    They know why they're selling them. I assume you know why you're buying them. And the 2 of you even agreed on a price. How nice is that! Hurray for markets!
  4. Consider that trade a part of the sellers big trading strategy. If you have a big account, it makes sense to sell deep in the money PUTs to get 10% in a year. Not with a 30K account though.
  5. *drum roll*

    Maybe they were short the underlying?

  6. Market makers are always trying to stay delta neutral. Who knows what other options are in their holdings?
  7. cvds16


    +1 all the rest of the answers are were mostly rubbish here ...
  8. Uhhh, people who bought them earlier, and want to salvage a few dollars from their position?
  9. nltro


    Billy Hunt. AKA Billy Blow.
  10. eh?
    if you're short the underlying you can sell puts risk free.
    do you disagree?
    #10     Feb 15, 2011