Covered Put

Filed Under: c by
Covered Put
Position in a put option where writer of the option also has a short position on the stock. Else the writer may have deposited cash or equivalents matching the option exercise into a cash account. This restricts the risk of the option writer. If option holder exercises his option, the writer is more protected than with a naked put option or uncovered put option.

Recommended for you:

  1. Covered Call
  2. Covered or Hedge Option Strategies
  3. Uncovered Put
  4. Margin Requirement (Options)
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