I can purchase OCT $7 puts @ 0.30 to protect a 10k position. 15 contracts @ .30 = 1500 *.30=$450 If price drops to 0 I get 7*1500= $10,500 Hedged! What am I missing?
BK = Burger king of course. Being this is a stock trading forum, one would expect the BK initials to be widely recognized if not easily decipherable considering the context. Anyway I edited the title.
I don't understand the question. Whose bankruptcy? Maybe you should ask the question in a more understandable format for idiots like me?
Options payout during bk ----> Options payout during bankruptcy Forget about his posting. OP forgot to take his medicine and is not thinking straight. First, he said bk. Then he said bk = BURGER KING Then he changed bk to Bankruptcy BK can mean many things Blowjob King Burger King BranKruptcy Big Kiss ....
A lot of things. First of all, which underlying are we talking about here? Burger King? The ticker symbol for Burger King is QSR not BK. Burger King is not a standalone restaurant anymore; it's owned by a restaurant group conglomerate. Second, for QSR options, there is no strike price at $7, the lowest strike price for the put is $37.5 which is priced at $1.20 not at 30 cents. Can you post your underlying positions so we can see what underlying did you buy at what price and for how much and also its options chain? It would be helpful if we can see what you are referring to to help you further. Just looking at what you posted, something doesn't look right. The purchase price of the put looks way too cheap for a put with a strike price that can give you a complete hedge. If you can have a complete hedge right now, that means the put would be ITM. Nobody in the world even when they are drunk and drugged would sell you an ITM put for less than a dollar especially if bankruptcy is imminent. If you have to pay more for an ITM put then there is no way you would have a complete hedge when exercised. After selling a put, maybe, but not exercising. So please post an actual Account position screenshot and options chain if you want us to help you. No hypothetical examples please.
That's not a hypothetical...those numbers are from the option chain. I'll post screenshot when market open.