What Most Investors Don’t Know About Selling Naked Puts

[perry-qit-naked-puts-order-page-header (1)]( Fellow Investor, Bryan Perry here again. I’m the Editor and Chief Investment Officer at Quick Income Trader. Today I want to address one of the misconceptions some investors may have about selling naked puts as an income strategy. One misconception is that traders face potential “infinite” downside risk. In fact, traders selling naked puts face a risk similar to what someone faces who sells a covered call on a stock: that the value of the stock falls to zero! In that case, the put seller would be obligated to buy 100 shares of the stock at the strike price for every contract held, even though it's worthless. For example, if someone sold a put options with a strike price of $50 on 100 shares of a stock and received a premium of $2 per share, and the value of the stock fell to zero, the maximum loss would be: ($50 - $2) x 100 shares = $4,800 per contract. This is not a small thing but it’s not “infinite” downside risk. In reality, stocks rarely fall in value to zero. And there are steps that naked put traders can take if a trade goes against them. The most straightforward way to limit losses is to close the position by buying back the put option for a loss. Traders can also “roll over” a position by closing the current put and simultaneously selling a new put with a later expiration date, or with a different strike price. This can provide more time for the stock to recover or reduce the immediate risk. Some income traders also hedge their positions with more advanced strategies to limit their potential losses. So there are ways to mitigate losses when selling put options. Nevertheless, the larger point is true: Naked put selling is considered a higher-risk strategy and is usually only considered suitable for experienced traders with the financial capacity to withstand potential losses. Yet there is a reason why experienced traders use this strategy. When done right, [it’s a great way to add consistent income and share-price gains to a portfolio.]( If you didn’t see it in a previous email, I can show you just how “great” this is with a couple recent trades… In September 2024 I closed out FOUR trades using this same strategy – one for a profit of 33.5%, another for 50.3%, a third for 58.5% and a fourth for 55%. Since I began using this strategy seven years ago, my naked put trades have had an average gain of 29% per trade (winners and losers combined) in just 31 days. [That works out to an average annualized return of 342.17%!]( I’m not telling you all this to brag. I’m doing it to convince experienced option traders and wealthier investors to attend a LIVE online training webinar where I go over the basics of selling puts -- the good, the bad and the ugly: ["Trading Naked Puts for Income” LIVE Online Webinar]( ​​​​​​ 1:00 PM ET on Wednesday, October 9, 2024 In this LIVE demonstration webinar,[perrynakedcomputer]( I’ll go into the details of my “naked put” income strategy, demonstrating how we identify four to five trading opportunities every month. This webinar is designed to dispel many of the false ideas many investors have about trading puts... And reveal this strategy’s income producing potential to as many people as possible. During the upcoming webinar, attendees will discover… - How selling naked puts can help generate consistent income from the stock market -- without owning a single share of stock! - Why naked puts can often outperform bonds in low-interest environments - The reason why selling naked puts is like being the house in a casino (the odds are in their favor) - A way to use naked puts to implement a dollar-cost averaging strategy on steroids! - 4 facts every investor must understand when selling naked puts - The right way and the wrong way to use a margin account - How to profit even when the underlying stock moves sideways in a choppy market! - 6 steps investors can take when a naked put position goes against them - The role of stop-loss orders in protecting a naked put position - The importance of limiting position sizes and proper money management - Why BUYING puts can actually protect a naked put seller from potential downside losses - And lots MORE! In short: [This is a jam-packed, LIVE online webinar.]( It’s an event I don’t think anyone who is approved for option trading – or who is interested in trading and understands the risks – should miss. What we’ll go over is based on real-world techniques that I use when making and recommending these trades. And here’s the best part: we regularly charge $249 for an event like this. [Yet, for those who act right away and reserve a space now, the price is only $199.]( In exchange for registering early, we’re knocking 50 bucks off the regular price. Once your spot is reserved, I’ll send along the details about how to log on for the webinar and how to access the recorded version after the live event. So, [please click on the button below right now.]( I’m excited to introduce experienced traders to the little-understood strategy of trading naked puts for income. [reserve your spot button 1]( Talk soon, [Bryan Perry] Bryan Perry Editor, Quick Income Trader ​​​​​ © Copyright: Eagle Products, LLC – a Salem Communications Holding Company. All rights reserved 122 C Street NW, Suite 515, Washington, DC 20001 [Privacy Policy]( [Link](