What trading platform let me short naked options?
I want to short calls and puts like I short stocks.I am not interested in selling the calls and puts because I have to own the stock which I do not want to.It is named schort naked options.Thank you.
Almost all options brokers allow writing naked options. The problem really is your risk level assessment. When opening a broker account, you will be asked to fill out some forms surveying your financial strength as well as your options trading experience. If you are a beginner to options trading, you are very unlikely to be approved for naked options writing.
Are you wondering now why they are so strict on options writing? Well, if you have been told that writing options is like the safest way to trade options, you have been fooled. Writing options without the sophistication of an options expert will only land you in bankruptcy as it is an unlimited loss position. See? That is why brokers don’t let you do it without significant experience.
March 16th, 2010 at 9:27 pm
Tango.
References :
March 16th, 2010 at 10:06 pm
Almost all options brokers allow writing naked options. The problem really is your risk level assessment. When opening a broker account, you will be asked to fill out some forms surveying your financial strength as well as your options trading experience. If you are a beginner to options trading, you are very unlikely to be approved for naked options writing.
Are you wondering now why they are so strict on options writing? Well, if you have been told that writing options is like the safest way to trade options, you have been fooled. Writing options without the sophistication of an options expert will only land you in bankruptcy as it is an unlimited loss position. See? That is why brokers don’t let you do it without significant experience.
References :
http://www.optiontradingpedia.com/free_naked_call_write.htm – Learn about the rewards and risks of naked call write.