This is a strategy article for FullyInformed Members that discusses why rolling naked puts down is key to controlling loss of capital. The recent downturn in Apple Stock on September 11 placed my naked put strikes at the $480 put into the money and left my positions at risk of possible assignment. While the risk of assignment in Apple Stock is quite low, even on deep in the money naked puts, until close to option expiry or sometimes shortly after a dividend is declared, it is important to put in place a consistent strategy when Put Selling that has been tested and works. Rolling naked puts has distinct advantages that many investors are unaware of.
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