Lightwave Logic Inc (LWLG)

[Lewrock]

When entering an option order, the trader must designate whether the action is one of the following:
STO - sell to open
STC - sell to close
BTO - buy to open
BTC - buy to close

Today I placed several STO trades for the 09/16/2022 10.00 P. Because these were STO trades, the open interest increased by the volume of my trades (28). If the contracts remain open until 9/16, I will either book the proceeds as profit (stock price is >$10) or the owner of the put contracts will force me to buy 2,800 shares at $10 (stock price is <$10). In other words, I either book a profit of $13,440 or I buy 2,800 more shares at a net price of $5.20 per share. I am happy will either outcome!

The buyer of these puts paid me $13,440 to be able to sell me 2,800 shares at $10 up until 9/16/22. There is no way for me to know if the buyer already owns stock that they want to limit their losses, but not sell. If they do not own any stock, then they are just gambling that they can make a profit if the stock continues to go down.

Hope that helps!