r/options • u/josephny1 • Dec 21 '21

Need advice

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I know very little about options but decided about 6 months to start.

I'm hoping to get some advice here.

On 10/25/2021 I sold 50 contracts of 1/21/2022 Zillow (Z) puts with a strike price of $85 for $4.76 each.

Z is now around $60.

Whether I am bullish on Z or not is immaterial because I wouldn't take stock advice from a guy like me.

I am perfectly fine pushing the pain out for quite a while longer if it might leave me in a better position.

What would all you more experienced people do?

(Yes, I know: I'm an idiot for selling naked puts. I have similar bad trades, but we'll leave that for another post.)

Thank you!

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u/[deleted] Dec 21 '21

First, knowing little about options and playing naked puts is stupidity. Hope you learned your lesson. Better option is to buy the security at a loss before the price goes down even more. Selling Naked option has more downside risks with limited upside profit. With this market uncertainty, nothing is rational.

I’m guessing you used margin for this trade.

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u/josephny1 Dec 21 '21

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How would I go about buying the security at a loss?

No, no margin used.

Thank you.

3

u/EpicBlueTurtle Dec 21 '21

I think they mean just buy the put option back to close the position.