Hi all: I asked 3 Schwab brokers, all of which had no answer. Assume I have plenty of cash in my account like 100,000 I sell naked puts where if it hit the stike, It would be 50,000 of stock that I would buy Instead it expires worthless. During that duration of time, will I be charged margin interest?? Thanks
Haris357-Margin interest is only charged when your debit balance exceeds your equity. Until the day you get put the stock, you have a credit balance from short puts, not a debit balance.
It is a Sunday on a (major) three day holiday. Schwab WILL answer your questions. The problems is no options service people are there on the weekends. You MAY get one or two. Call several hours before markets open and they will have people that can answer your question. Many times I have called Schwab/Fidelity on the weekends with option questions...Their pat answer is call before markets open or during trading time. Margin options would be even more difficult. It's not the question...It's when you are asking them. I will also say that I have seen brokers close naked margin positions (or require you to front BIG BUCKS immediately), to keep open a position...Depending on the situation (don't know your situation and do not fully understand margin calls). One of the biggest complaints on these boards are brokers closing out positions or requiring huge influx of money (raising margin limits), at the worst possible time. Eyes wide open...