Replies to post #18331 on Advanced Micro Devices Inc (AMD)

[HailMary]

You start with $160000 cash. You can

1. buy 10000 shares outright and have no cash left
OR
2. perform the strategy outlined
AND
a. leave the cash as cash and earn your cash trust rate
OR
b. IF you have a lot more equity already in your account (which is likely if you're making a purchase like this), you should have the margin power to cover the put write, so you can put the cash into something better. You can pull the cash back out of this liquid equity at anytime to pay for the assignment instead of using margin.

2% on 160000 is still $3200.

Having said all that, I usually back my put writes with cash, and I never use the above strategy.

I think I'm done trying to make academic examples. I'll stick to my current strategies that I'm actually applying as they are more meaningful in the real world.

HailMary