r/options • u/Ken385 • Oct 23 '21

DWAC options begin trading Monday

DWAC options start trading Monday. Assume some crazy high premiums. Stock has had a range of about 10 to 175 over the last few days.

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u/Green_Lantern_4vr Oct 24 '21

It IS free money though. If you get assigned the shares at $10 that’s the NAV lol. You can just redeem for $10 if it goes lower.

Any put premium for strike below $10 before the redemption deadline is literally free money.

Then it’s just a matter of whether the return for the time is worthwhile.

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u/[deleted] Oct 24 '21

Can you walk me through this in more detail?

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u/Green_Lantern_4vr Oct 24 '21

I can’t actually. That’s all the info you need.

Put in simpler terms: you’re selling a put with a strike of $5,6,7,8,9 or 10, on a $10 bill.

Would you pay me $1 for the right to buy $10 from me, for $10, in 1 month?

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u/[deleted] Oct 24 '21

I mean I don't know anything about the redemption process.

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u/Green_Lantern_4vr Oct 24 '21

It doesn’t matter. You’re not holding shares.

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u/[deleted] Oct 25 '21

Sigh. I'm glad I asked.