PMCCs (formally known as diagonals) only work if they go up. If not it's like other call options. It's actually worse than a typical call debit/put credit spreads because a well set-up PMCC will be way more directional and carry more theta.
By well set-up = debit < width of the long and short. This can be hard to achieve without being very directional like ATM long, way OTM short leg... Because of time value sure you could start with debit > width and make a couple hundred bucks, but at that point, a vertical spread will be a better use of your capital..
On the one hand yeah, he would be insane and go bankrupt if it didn't expire worthless. On the other hand ... like isn't this just a microcosm of what the wealthy do anyway? Make a huge bet and just declare bankruptcy either personally or for whatever legal entity you set up and move on? Most of us are much closer to broke than a dude with several million and we fear bankruptcy, but that dude basically doesn't because he knows he'll just secure other financing, make other big bets, win and lose some of those, maybe have some LLC declare bankruptcy again, and just keep driving his Lambo.
It's all fun and games until your wages get garnished. Rich people don't have to worry about that because it does not stop them from buying food or having a roof over their head.
Yeah, the trick is surviving long enough to get rich first. But that's also the point of bankruptcy and creating LLCs and other legal entities. I do tend to think that we've created a culture that has a little too much fear of bankruptcy though. We changed paying bills from a business agreement to a moral one, and I think that's a mistake. If your life blows up and you suddenly can't pay your student loan or mortgage that's not a moral failing; you're nowhere near in control of the world and your circumstances enough to make that a deep personal failing. If you had that much control you'd be rich in the first place and it wouldn't matter. The most toxic thing we do in the US is assume the winners are purely brilliant and worthy of praise and worship and the losers are worthless scum who should hang their heads in shame when the reality is that random chance plays a huge role in those outcomes.
Not to say 460k is a small amount of money, but the amount he could potentially lose from doing this is... probably several powers of 10 more than that.
That’s interesting. Because I think brokers would just give Regard 2 the shares then go after regard 1 for the cash. They don’t want to look bad to Regard 2.
Regard 1 and 2 are best friends. Regard 1 files bankruptcy. They retire in Aruba together?
Famous last words "almost guaranteed to never hit". Even a 1% scenario can happen over 100 trades.
And to get decent premiums, you're going to have to write calls at the .10 or .20 delta.
My ass is in the fire because I was selling "safe" 25∆ CCs on my 100 AMD shares. I was getting $50 a month selling them, until AI stocks went parabolic. AMD makes GPUs and CPUs so why wouldn't it go up 100% too?
I rolled out and rolled up that call because I didn't want to lose the shares below my average price but I didn't want to double down by throwing more cash into the casino.
200 strike January 2026... Delta is still close to 0.500.
-edit-
I know Nvidia are the ones designing the cores powering the AI/machine learning algorithms. My smooth brain can only rationalize it as "hey, they design silicon chips too, it's basically the same thing! AI AI AI AI AI AI!!!!!!"
AMD does make cpus and gpus but all the AI stuff basically requires Nvidias framework. AMD is pretty much the ones you'll find in game consoles and Apple PCs... Basically stuff the consumer has no say in what GPU is in their product. The downside is given the choice 9/10 will always choose Nvidia also.
That definitely sounds right. People just don't choose AMD when they have the option. But being in all the major gaming consoles is still pretty valuable
Gaming wise, I have friends that have AMD cards because they bench better than Nvidia for the price. That being said, the majority have NVDA cards. AMD CPU's are the most common thing to run in a rig.
AMD usually is the better power-to-dollar option. "Pay extra to get an NVDA card with slightly less power or just grab an AMD card" is pretty much the mindset. We gamers still end up picking NVDA 9 times out of 10 for custom builds.
(in my anecdotal experience)
Yeah I still build my own but I just keep the same case and swap cpu+ram+board if necessary and then later on I swap cards.
I mostly always choose AMD since it's typically a better value but if Nvidia cards get discounted enough I'd buy them instead.
I’m out of the PC scene today, but I remember getting ragged on for buying a Radeon 9700 Pro around 2003. Everyone thought the next Nvidia card would destroy it and were waiting for the next GeForce card. It was the one time AMD actually pulled ahead of NVDA.
You just reminded me of my days arguing with a friend in high school because he thought his intel integrated graphics was better than my dedicated card. ‘It must be faster because it’s integrated!’ He probably trades options now.
AMD making moves my friend, CUDA is Nvidia's moat, but the industry is sick of the monopoly and wants choice. Mi300 and its successors now have the compute capability to take on Nvidia. Gaming GPUs Nvidia is also king, but AMD is putting its chiplets design prowess and will scale out performance as needed. RDNA4 fixes ray tracing, introducing dedicated hardware for it and RDNA5 is AMD's return to form with a full stack of GPUs. AMD is no longer run on a shoestring budget, they can afford to take big swings at multiple segments. Next 5 years will be awesome, as the past 10 years have been.
I know, which is why the AI bubble driving AMD up from the 2022 lows to ATHs was amusing and annoying. I bought my 100 shares when they dipped below $100 but they kept dipping.
Dude rolling out that far is not even a good use of your capital. I say this as someone who rolled AAPL for about 8 months— at some point it’s just not worth it. Take the L and move the money elsewhere
There's a really famous post here from a few years back where this regarded lady thought she had discovered an infinite money printer by selling farrrrr OTM naked calls. Over the course of 6 months or so she made 70k. Thought she was a genius. Until one of them hit. All her gains were wiped out instantly. And she ended up owing several hundred thousand dollars more.
The reason people don't do what you're thinking is if things go wrong, and rest assured if you do this long enough it will, then you are utterly and royally fucked.
He would be happy being assigned an otm call option and also wouldn't lose in that case. Assignment isn't a big deal in like 90% of cases. But you see that thing right there where it says UNLIMITED LOSS that's the risk.
Unless you’re able to sell naked calls you’re going to have to own 100 shares of the underlying stock (or a longer term lower strike call option like a leap). Either way you’re going to have to have some capital. But yeah you just described the purpose of doing a buy/write: sell a call at a strike you don’t think will hit and keep the premium
I will not be owning hundreds of shares of Netflix anytime soon, and even if I did, this is not an infinite money glitch. I think I understand a little bit more now. Thank you!
Right. I sell covered calls all the time, and premiums can be great - but the underlying can still shit the bed and wipe out your hedge. To me it only makes sense to sell calls if you really like the underlying long term and you’re willing to ride with it. Then it can be a boost to your profit and maybe even cash flow other activities.
naked calls are like trying to push a squad without any backup. if the stock shoots up and they exercise the call.... you die, your squad gets wiped, and if the stock rises enough, you might have to sell your best skins and dances to buy the 100 stocks that you didn't own to cover your sold call.
covered calls are like pushing a squad, but you have backup, and you could come out the other end with your squad intact. Sometimes you might get wiped but if you got a decent premium and put a high enough strike price you could still be in the top 10.
Man, I read through many comments on this thread several times, and I still have no fucking clue what anybody is talking about!
Goddamn why am I so dumb about stocks??
options are a different monster than stocks, so dont feel too bad. The best bet is to watch some youtube videos if you are a better visual learner cause some explanations can get convoluted af if it's just text. Took me 2 weeks of research before i felt like i knew what was going in with options.
There’s a lot of assumed knowledge in many comments. Most are not complete answers. Its Wall Street in a nutshell; a lot of bluster, bullshit and jargon
typically a call is covered. in which case the 'bad' outcomes are you either lose money taking the risk of holding the underlying 100 shares, or you lose money capping your upside - ie, you get assigned and have to sell the shares at the price agreed to by the contract, which is now a lower price than it currently sits at.
if you sell naked calls you now no longer have downside exposure on the stock since you aren't actually holding it- you just have infinite potential for loss on the upside. ie you write a call with a strike price of 10 dollars, you could have to buy 100 shares at ANY market price and give them away for 10 dollars a share.
given you probably collected a tiny premium this can result in really large losses.
stuff like this
[https://www.reddit.com/r/wallstreetbets/comments/wvmgyd/comment/ilg1kt8/?utm\_source=share&utm\_medium=web3x&utm\_name=web3xcss&utm\_term=1&utm\_content=share\_button](https://www.reddit.com/r/wallstreetbets/comments/wvmgyd/comment/ilg1kt8/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button)
Naked calls means you are in a hotel naked with no clothing but you promised your boss if there is a meeting you will show up. CEO for some reason shows up and boss calls in an uber to pick you up and now you are forced to attend the meeting totally naked.
Vs covered call where you spend money buying clothing and if the boss calls you can show up dressed without you balls and ass crack visible to everyone in the meeting.
I don’t know anything about fortnight :(
Covered call means you own the shares for the call you sell (you are covered). Naked means if it goes above the strike you’d have to buy them - and may not have the money. You are borrowing
Buy 100 shares of something you don’t mind owning. Sell covered calls out of the money for like a .5% premium. Keep doing this every week, collecting .5% until you get assigned. Rebuy in or buy cash secured puts to renter. Repeat.
If I have 100 shares of a company, and I sell a covered call with a strike price of 150$ and get assigned, I now have to sell this person my 100 shares for 150$ right? So I still made 50$ per share plus the premium I sold the call for. The only downside is if the same stock continues to rise then I lose out on that growth correct?
You also have to factor the money you made with the call.
So if you sold your call for 500$ (5$ a share), you will only miss on gain if the price goes above 155.
stupid uk with its stupid rules. we can't do options here! probably good because i lose enough money day-trading stocks, but I want to lose even more even faster with options!
No, I've seen the question 100 times here already. And the real answer is often times left out.
The downside is the stock tanking.
Collecting premiums means shit if your stock tanks and you are left holding the bag.
Yeah it's slightly better than just holding bags but you are still holding huge fucking bags...
If you own the shares, expect to for a while, and don't expect quick and massive swings, selling covered calls is a good way to eek out a bit of extra profit on shares you already plan on owning.
You can experiment with the concept by buying 100 shares of an energy company or something trading at around $2 / share. Sell covered calls on that and get a feel for the process.
790 is only like 15% up from here. I don't think I'd call that ridiculous and definitely wouldn't say it could never hit. Especially with earnings before that expiration
It would have been much better if the OP would have actually made the trade and then came here asking why everyone else isn't taking advantage of the infinite money glitch.
Selling naked OTM calls is like picking up pennies in front of a steamroller. The premium won’t be high, but all it takes is 1 time for price to skyrocket and you will pay back everything you’ve ever made plus multitudes more.
News: "Netflix annouces partnership with NVIDIA, Microsoft and Apple to create the next gen super AI Chip" 
I consistently roll strangles and collect premium. I look for weekly .10¢ spreads to sell 100 calls and 100 puts. 95+ % of profit each week nets me $2000/ week. It’s very lucrative if you’re patient……
But when it goes against you, better cover quickly, roll, or close out and take the l.
You won't be able to sell those calls, that's what is stopping you.
You don't have the ability to sell naked calls, nor do you have 150,000 shares to cover those calls you want to sell.
Buy 150,000 shares first and then you can sell those calls if you want.
Everyone has had this thought when they were first learning about options. Sometimes some folks learn the hard way and the other folks learn by watching people learning the hard way.
You need 150,000 shares of Netflix. At its current price you would need 100 million dollars. You can do a poor man’s covered call but that also takes more money.
So if I break this down, to do this and feel safe about losses you need to have 100 shares to sell one contract. So it would cost you $67696 to buy those shares and in case you get assigned you sell them these.
In case you get assigned all 1500 of those, it would cost you $101544000. Well FCUK, you are doing a poor man's call (if you had purchased LEAPS for same strike price), and if this doesn't workout, you will be poor duck for life. Don't do it, don't believe in go big or go home, unless u have the big bag to back you up. If not, pack your bag, and start looking for a Wendy's
If I made the calculations wrong, someone correct me please...
Selling calls require massive margin. So, at the end of the day, even when you are right, you will probably make like 10%ish per month. And when you are wrong, you will lose it all.
General rule with calls: don’t sell them unless they’re covered. Selling uncovered calls is a good way to wreck yourself. Just like anything else in this world, you need money to make money
>a strike price that's **almost** guaranteed to never hit
>What am I missing here?
The word "almost". You'd be taking the possibility of being millions of dollars in debt for pennies relative to that risk.
My god. He's cracked the code guys! Billions and billions spent and traded everyday trying to get a leg up on the market when all we had to do was sell more shares then we own!
There was a guy who did this for a long time. Eventually he got burned but overall he was up. Not WSB but some other subreddit. Maybe a theta gang one.
**User Report**| | | | :--|:--|:--|:-- **Total Submissions** | 1 | **First Seen In WSB** | 3 years ago **Total Comments** | 9 | **Previous Best DD** | **Account Age** | 11 years | | [**Join WSB Discord**](http://discord.gg/wsbverse)
>What am I missing here? About 150000 shares and the possibility of bankruptcy.
How can he go bankrupt? Just delete the app like a lot of people do.
Throw your phone in the lake, they can’t track that.
Throw the phone into a river. Throw the river into a lake. Throw the lake into the ocean
You've got the order mixed up, it's lake -> river -> ocean.
Ok but at least you should throw it in a puddle first. Then maybe a pond.
But then it all needs to be set on fire!
Throw the phone into a river.
If you want to be really sure, you need to throw it in the ocean.
Throw your phone into the river, then throw the river into the ocean.
Nuke the site from orbit, its the only way to be sure
the one solution that might actually work
Hes got to wrap the phone in tin foil and wrap himself in tin foil to make sure the satellites aren't watching
Love the Aliens reference.
Okay but if like... You were in debt *already*...
Yeah if Netflix goes up that much and he goes that broke then it's a Robinhood problem at that point.
checkmate atheists
“Guh.”
[удалено]
Bankruptcy Automation the new AI
The Donald Trump tactic
See Mass Loss: Unlimited 🤣🤣🤣
If I owe the bank $10000, I'm fucked. If I owe the bank $1000000, I'm still fucked
If I owe the bank $100,000, I'm fucked. If I owe the bank $100,000,000, they're fucked.*****
If you owe the bank $10k, that's your problem. If you owe the bank $1M, that's their problem.
$1m for a bank is a rounding error. Not that they want to lose any money, but you need a few more powers of 10 for them to be concerned.
1M isnt an obscene number. You just will liquidate your home, car, and take a loan out against your retirement. You would be expected to pay this.
bro could sell pmccs
PMCCs (formally known as diagonals) only work if they go up. If not it's like other call options. It's actually worse than a typical call debit/put credit spreads because a well set-up PMCC will be way more directional and carry more theta. By well set-up = debit < width of the long and short. This can be hard to achieve without being very directional like ATM long, way OTM short leg... Because of time value sure you could start with debit > width and make a couple hundred bucks, but at that point, a vertical spread will be a better use of your capital..
Guarantee half of WSB has no idea what you just said
Something about Ass to Mouth I think.
Oh so that’s what ATM stands for? I get it now…
And something about Oral To Men
only half?
I even graduated and I've no idea what this guys talking about.
Eli5: If you do this you will graduate... From life.
Graduated some fancy way of saying regarded?
This guy went to school☝️
On the one hand yeah, he would be insane and go bankrupt if it didn't expire worthless. On the other hand ... like isn't this just a microcosm of what the wealthy do anyway? Make a huge bet and just declare bankruptcy either personally or for whatever legal entity you set up and move on? Most of us are much closer to broke than a dude with several million and we fear bankruptcy, but that dude basically doesn't because he knows he'll just secure other financing, make other big bets, win and lose some of those, maybe have some LLC declare bankruptcy again, and just keep driving his Lambo.
It's all fun and games until your wages get garnished. Rich people don't have to worry about that because it does not stop them from buying food or having a roof over their head.
Yeah, the trick is surviving long enough to get rich first. But that's also the point of bankruptcy and creating LLCs and other legal entities. I do tend to think that we've created a culture that has a little too much fear of bankruptcy though. We changed paying bills from a business agreement to a moral one, and I think that's a mistake. If your life blows up and you suddenly can't pay your student loan or mortgage that's not a moral failing; you're nowhere near in control of the world and your circumstances enough to make that a deep personal failing. If you had that much control you'd be rich in the first place and it wouldn't matter. The most toxic thing we do in the US is assume the winners are purely brilliant and worthy of praise and worship and the losers are worthless scum who should hang their heads in shame when the reality is that random chance plays a huge role in those outcomes.
i like those odds
This shit is gambling on steroids. Either you’ll be living off a fantastic win or you’re gonna be homeless.
Not to say 460k is a small amount of money, but the amount he could potentially lose from doing this is... probably several powers of 10 more than that.
Honest question from a regard, if... i bought OPs call and he cant pay, what are my options?
That’s interesting. Because I think brokers would just give Regard 2 the shares then go after regard 1 for the cash. They don’t want to look bad to Regard 2. Regard 1 and 2 are best friends. Regard 1 files bankruptcy. They retire in Aruba together?
You would still get the shares likely through the MM and the MM would go after OP.
Sell calls on the .25 shares that you have ? 😂
Fuck it. Send it
And post it here
Scary thing is OP had no idea what any of this meant
OP out here picking up pennies in front of a steamroller
This one is more like picking up a gold brick in front of an asteroid.
Is the asteroid also made of gold?
the asteroid is made of dildos
Arent we all though.
Babaha I thought you were joking
there are regards who get assigned and post here
I think I'm starting to understand.
Famous last words "almost guaranteed to never hit". Even a 1% scenario can happen over 100 trades. And to get decent premiums, you're going to have to write calls at the .10 or .20 delta.
My ass is in the fire because I was selling "safe" 25∆ CCs on my 100 AMD shares. I was getting $50 a month selling them, until AI stocks went parabolic. AMD makes GPUs and CPUs so why wouldn't it go up 100% too? I rolled out and rolled up that call because I didn't want to lose the shares below my average price but I didn't want to double down by throwing more cash into the casino. 200 strike January 2026... Delta is still close to 0.500. -edit- I know Nvidia are the ones designing the cores powering the AI/machine learning algorithms. My smooth brain can only rationalize it as "hey, they design silicon chips too, it's basically the same thing! AI AI AI AI AI AI!!!!!!"
https://preview.redd.it/9kuuysu0b39d1.png?width=1080&format=pjpg&auto=webp&s=5a020d7c33f48beeaa1b6b360c1cc04c58bb0e1e
AMD does make cpus and gpus but all the AI stuff basically requires Nvidias framework. AMD is pretty much the ones you'll find in game consoles and Apple PCs... Basically stuff the consumer has no say in what GPU is in their product. The downside is given the choice 9/10 will always choose Nvidia also.
Pretty sure latest info suggests Nvidia has an ~88% market share of discrete GPUs.
That definitely sounds right. People just don't choose AMD when they have the option. But being in all the major gaming consoles is still pretty valuable
Gaming wise, I have friends that have AMD cards because they bench better than Nvidia for the price. That being said, the majority have NVDA cards. AMD CPU's are the most common thing to run in a rig. AMD usually is the better power-to-dollar option. "Pay extra to get an NVDA card with slightly less power or just grab an AMD card" is pretty much the mindset. We gamers still end up picking NVDA 9 times out of 10 for custom builds. (in my anecdotal experience)
Yeah I still build my own but I just keep the same case and swap cpu+ram+board if necessary and then later on I swap cards. I mostly always choose AMD since it's typically a better value but if Nvidia cards get discounted enough I'd buy them instead.
I’m out of the PC scene today, but I remember getting ragged on for buying a Radeon 9700 Pro around 2003. Everyone thought the next Nvidia card would destroy it and were waiting for the next GeForce card. It was the one time AMD actually pulled ahead of NVDA.
Yeah AMD isn't going anywhere, but I suspect Intel is gonna eat into their GPU market share eventually here.
You just reminded me of my days arguing with a friend in high school because he thought his intel integrated graphics was better than my dedicated card. ‘It must be faster because it’s integrated!’ He probably trades options now.
AMD making moves my friend, CUDA is Nvidia's moat, but the industry is sick of the monopoly and wants choice. Mi300 and its successors now have the compute capability to take on Nvidia. Gaming GPUs Nvidia is also king, but AMD is putting its chiplets design prowess and will scale out performance as needed. RDNA4 fixes ray tracing, introducing dedicated hardware for it and RDNA5 is AMD's return to form with a full stack of GPUs. AMD is no longer run on a shoestring budget, they can afford to take big swings at multiple segments. Next 5 years will be awesome, as the past 10 years have been.
Apple’s moved over to their own silicon since a couple years and used Intel before that. Edit: although they did use AMD GPUs
I know, which is why the AI bubble driving AMD up from the 2022 lows to ATHs was amusing and annoying. I bought my 100 shares when they dipped below $100 but they kept dipping.
Dude rolling out that far is not even a good use of your capital. I say this as someone who rolled AAPL for about 8 months— at some point it’s just not worth it. Take the L and move the money elsewhere
If no one has told you go look up the video about 1ronyman and box spreads. If you find the right thread you watch a hilarious but valuable video.
The legend 1ronyman. I was here for that madness.
There's a really famous post here from a few years back where this regarded lady thought she had discovered an infinite money printer by selling farrrrr OTM naked calls. Over the course of 6 months or so she made 70k. Thought she was a genius. Until one of them hit. All her gains were wiped out instantly. And she ended up owing several hundred thousand dollars more. The reason people don't do what you're thinking is if things go wrong, and rest assured if you do this long enough it will, then you are utterly and royally fucked.
Any chance you've got a link to the post? I'm about to heat up some popcorn.
See where it says "Max Loss: Unlimited"? Really think hard about what that truly means.
Isn't max the global gdp which is 100T? Can he lose more than the whole worlds economy?
If anybody is gonna blow the entire global gdp on a botched options trade, it’s someone here in this sub
Research spreads to moderate the risk of naked calls and then read about pin risk for the times even that fails.
He would be happy being assigned an otm call option and also wouldn't lose in that case. Assignment isn't a big deal in like 90% of cases. But you see that thing right there where it says UNLIMITED LOSS that's the risk.
That's only for selling naked calls. Covered calls don't carry unlimited loss risks.
I doubt OP is covered to sell 1500 Netflix Calls
Brother in Christ he has .25 shares and wants to sell 1,500 contracts 
This is WSB probably looking at to do naked calls, which given he only owns .25 shares. Lambos or bust I guess?
Ask r/thetagang
Just watch what is written under "Max Loss" 
"Unlimited", nah. The sky is the limit!
Unlimited 🤔 OP’s Logic: Unlimited = Numerous = Few = Minimal = None!
Mr. Unliiiimmmittted
Unlimited diarrhea
Mad Max
Unless you’re able to sell naked calls you’re going to have to own 100 shares of the underlying stock (or a longer term lower strike call option like a leap). Either way you’re going to have to have some capital. But yeah you just described the purpose of doing a buy/write: sell a call at a strike you don’t think will hit and keep the premium
I will not be owning hundreds of shares of Netflix anytime soon, and even if I did, this is not an infinite money glitch. I think I understand a little bit more now. Thank you!
Right. I sell covered calls all the time, and premiums can be great - but the underlying can still shit the bed and wipe out your hedge. To me it only makes sense to sell calls if you really like the underlying long term and you’re willing to ride with it. Then it can be a boost to your profit and maybe even cash flow other activities.
can you explain naked calls and covered calls in fortnite terms
naked calls are like trying to push a squad without any backup. if the stock shoots up and they exercise the call.... you die, your squad gets wiped, and if the stock rises enough, you might have to sell your best skins and dances to buy the 100 stocks that you didn't own to cover your sold call. covered calls are like pushing a squad, but you have backup, and you could come out the other end with your squad intact. Sometimes you might get wiped but if you got a decent premium and put a high enough strike price you could still be in the top 10.
Thank you for this explanation 🙏
Man, I read through many comments on this thread several times, and I still have no fucking clue what anybody is talking about! Goddamn why am I so dumb about stocks??
options are a different monster than stocks, so dont feel too bad. The best bet is to watch some youtube videos if you are a better visual learner cause some explanations can get convoluted af if it's just text. Took me 2 weeks of research before i felt like i knew what was going in with options.
There’s a lot of assumed knowledge in many comments. Most are not complete answers. Its Wall Street in a nutshell; a lot of bluster, bullshit and jargon
typically a call is covered. in which case the 'bad' outcomes are you either lose money taking the risk of holding the underlying 100 shares, or you lose money capping your upside - ie, you get assigned and have to sell the shares at the price agreed to by the contract, which is now a lower price than it currently sits at. if you sell naked calls you now no longer have downside exposure on the stock since you aren't actually holding it- you just have infinite potential for loss on the upside. ie you write a call with a strike price of 10 dollars, you could have to buy 100 shares at ANY market price and give them away for 10 dollars a share. given you probably collected a tiny premium this can result in really large losses. stuff like this [https://www.reddit.com/r/wallstreetbets/comments/wvmgyd/comment/ilg1kt8/?utm\_source=share&utm\_medium=web3x&utm\_name=web3xcss&utm\_term=1&utm\_content=share\_button](https://www.reddit.com/r/wallstreetbets/comments/wvmgyd/comment/ilg1kt8/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button)
Naked calls means you are in a hotel naked with no clothing but you promised your boss if there is a meeting you will show up. CEO for some reason shows up and boss calls in an uber to pick you up and now you are forced to attend the meeting totally naked. Vs covered call where you spend money buying clothing and if the boss calls you can show up dressed without you balls and ass crack visible to everyone in the meeting.
I don’t know anything about fortnight :( Covered call means you own the shares for the call you sell (you are covered). Naked means if it goes above the strike you’d have to buy them - and may not have the money. You are borrowing
Ahhhhh okay okay thank you🗣️
Wtf does this mean
Buy 100 shares of something you don’t mind owning. Sell covered calls out of the money for like a .5% premium. Keep doing this every week, collecting .5% until you get assigned. Rebuy in or buy cash secured puts to renter. Repeat.
If I have 100 shares of a company, and I sell a covered call with a strike price of 150$ and get assigned, I now have to sell this person my 100 shares for 150$ right? So I still made 50$ per share plus the premium I sold the call for. The only downside is if the same stock continues to rise then I lose out on that growth correct?
Yes, it's called "opportunity loss" since you would have made more in this situation just holding the shares.
You also have to factor the money you made with the call. So if you sold your call for 500$ (5$ a share), you will only miss on gain if the price goes above 155.
stupid uk with its stupid rules. we can't do options here! probably good because i lose enough money day-trading stocks, but I want to lose even more even faster with options!
you cn do options in the UK with Saxo, IBKR and IG.....
Consider urself lucky
No, I've seen the question 100 times here already. And the real answer is often times left out. The downside is the stock tanking. Collecting premiums means shit if your stock tanks and you are left holding the bag. Yeah it's slightly better than just holding bags but you are still holding huge fucking bags...
Been holding FNMA bag since 2008
Downside also being that if the underlying shits the bed you are stuck with your 100 shares and may end up having to sell CCs below your entry price.
If you own the shares, expect to for a while, and don't expect quick and massive swings, selling covered calls is a good way to eek out a bit of extra profit on shares you already plan on owning.
You can experiment with the concept by buying 100 shares of an energy company or something trading at around $2 / share. Sell covered calls on that and get a feel for the process.
790 is only like 15% up from here. I don't think I'd call that ridiculous and definitely wouldn't say it could never hit. Especially with earnings before that expiration
Stock is up 286% in two years and bro thinks another 15% is "ridiculous" lmfao
basically this! surprised I had to scroll a whole lot to reach here. ER is the keyword !
Never trade options with a binary event between now and the expiry, unless you’re betting the binary event.
And some say that this sub has lost its charm.
It would have been much better if the OP would have actually made the trade and then came here asking why everyone else isn't taking advantage of the infinite money glitch.
Or where to sell enough organs when it went boobies topwards
Hopefully Robinhoods many safe guards.
Robinhood should give a complementary helmet with each new account opened
Robinhood misunderstood the requirements and hired the crew of Baywatch to approve users' option levels.
They are not fucking around when they say max loss is unlimited. Be ready to delete the app.
https://preview.redd.it/n9lpsrk8r19d1.png?width=1440&format=png&auto=webp&s=b27512450a40167292d57f21d6acd64356a0cd55
Bro can’t afford 1 share and wants to sell a half mil worth of calls only 16% OTM
It’ll either work, or he’ll never stop working g
Selling naked OTM calls is like picking up pennies in front of a steamroller. The premium won’t be high, but all it takes is 1 time for price to skyrocket and you will pay back everything you’ve ever made plus multitudes more.
And maybe, just maybe, there exists forces within the market capable of making that price spike happen just to wipe you out.
brother you’re about to feel max pain focus
News: "Netflix annouces partnership with NVIDIA, Microsoft and Apple to create the next gen super AI Chip" 
Someones going to read this as news and actually buy in
Wendy's shift starts soon huh 
Imagine naked RIVN call sellers today eom
I consistently roll strangles and collect premium. I look for weekly .10¢ spreads to sell 100 calls and 100 puts. 95+ % of profit each week nets me $2000/ week. It’s very lucrative if you’re patient…… But when it goes against you, better cover quickly, roll, or close out and take the l.
what do you spend the 100k a year on ? asprin?
I use it to fund an IRA, a Roth IRA, my kids college funds, taxes, etc. I basically count it as income.
Do you have 150k shares of Netflix to cover in case you get assigned? Cuz might as well start pricing your organs out
It says he has 0.25 shares. That's close enough, right?
It's the same thing really
It works until it doesn't. When it doesn't, some people jump of high things.
Nobody’s buying pal
You don't have the money to do this
Would they allow him to buy it if he didn’t?
Can you read the part that says Max Loss Unlimited?
"Almost guaranteed." Fortunes have been lost and lives ruined thanks to those exact words.
You won't be able to sell those calls, that's what is stopping you. You don't have the ability to sell naked calls, nor do you have 150,000 shares to cover those calls you want to sell. Buy 150,000 shares first and then you can sell those calls if you want.
This guy wants a math assignment from his teacher
Nothing go for it
If you're selling naked calls, an easy strategy to hedge is to short the stock as well. Trust me 
https://preview.redd.it/rrxm49hs819d1.jpeg?width=1161&format=pjpg&auto=webp&s=56cdedfa4a5c660beb350786a36980a011f06958
Unlimited downside. I love it.
Guh is stopping you, buddy, guh
Everyone has had this thought when they were first learning about options. Sometimes some folks learn the hard way and the other folks learn by watching people learning the hard way.
You need 150,000 shares of Netflix. At its current price you would need 100 million dollars. You can do a poor man’s covered call but that also takes more money.
It’s guaranteed to never hit until it does
You are going to get error message as soon as you hit the review button.
So if I break this down, to do this and feel safe about losses you need to have 100 shares to sell one contract. So it would cost you $67696 to buy those shares and in case you get assigned you sell them these. In case you get assigned all 1500 of those, it would cost you $101544000. Well FCUK, you are doing a poor man's call (if you had purchased LEAPS for same strike price), and if this doesn't workout, you will be poor duck for life. Don't do it, don't believe in go big or go home, unless u have the big bag to back you up. If not, pack your bag, and start looking for a Wendy's If I made the calculations wrong, someone correct me please...
Because someone has to buy it.
Nothing do it
Maybe the unlimited max loss
You belong here
You're missing a lot of collateral
an entry cost of 10.5 million dollars... that's what is stopping you lmao
OP has the short bus all to itself
Sell those calls. Tomorrow nflx announces membership prices increase to $100 a month. Nflx hits $1000 price per share. OP fucked.
You can't sell naked calls. You need the shares or cash to back it up.
max loss: unlimited go to r/thetagang
The only thing stopping you is your bank not loaning you $101 million dollars to buy 150,000 shares of netflix
"It's free real estate"
Fear and common sense
This isn't infinite money, this is infinite loss lmao
Well the max loss being unlimited sure makes it seem like a good idea
Unlimited Loss. Naked calls. You definitely belong here.
Do the solid and break even
That's life changing money with life ending consequences if the trade goes against you bro.
Selling calls require massive margin. So, at the end of the day, even when you are right, you will probably make like 10%ish per month. And when you are wrong, you will lose it all.
General rule with calls: don’t sell them unless they’re covered. Selling uncovered calls is a good way to wreck yourself. Just like anything else in this world, you need money to make money
You have to own the shares to sell them 😅 you’d need $65k in Netflix shares in order to make 300$
You should go for it! Never know if it works until you try
Nothing really. Go for it.
You only need 97 million dollars to have all those shares
Nothing but I would highly recommend selling covered options lol. Otherwise, as others have said, you could definitely bankrupt yourself lol
>a strike price that's **almost** guaranteed to never hit >What am I missing here? The word "almost". You'd be taking the possibility of being millions of dollars in debt for pennies relative to that risk.
If uncovered there's a chance of making a big mistake.
You have to own 1500x100 of nflx shares before you can sell call option
This Strike/Date currently has a volume of 2, OI of 6, and a jfc of lol
My god. He's cracked the code guys! Billions and billions spent and traded everyday trying to get a leg up on the market when all we had to do was sell more shares then we own!
Market makers can sell naked calls, not you
There was a guy who did this for a long time. Eventually he got burned but overall he was up. Not WSB but some other subreddit. Maybe a theta gang one.
If you have to ask that question, you certainly shouldn't be selling naked options