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Scaling Into or out of Profitable Positions on the Stock Market
A mathematically concise way to structure and organize your portfolio better
Every trader has been put into that gut-wrenching position. Do you wait to buy or do you hold off on selling? Have you made enough of a profit or have you waited for the stock to fall enough?
People often display great skepticism at the convention of options trading. Most traders understand puts and calls — that is, most traders understand that calls are a way to highlight a bullish position in the short to long-term whereas a put is a bearish position in a similar timeline.
However, fewer people understand the convention of writing those two options and how far those can go as a viable navigating tool for your stock purchases or sales.
When it comes to entering or exiting positions, writing puts or calls can help take away some of that uncertainty.
Writing a put.
Effectively selling a put, this is a position that is opposite to the purchaser of a put. The purchaser is paying a premium to the seller for the purpose of making money on the difference should the stock price move downward. On the opposite side of that transaction is you, the seller of a put.
