Definition of Naked Put

A naked put is the put option whose writer has a short option in the stock on which the writer has written put. It is sometimes referred to as uncovered put. The underlying assets can save the person from the gain or loss.

Description of Naked Put

The naked put is risky if the underlying assets turn opposite to the desired direction same as the profits can lead to the best directions if the underlying assets turn in right directions.
The finance world is on high. It is high ratings and it is demanding the trading but on the other hands, it has some frizzy dazzles to it. a naked put is a short position that confers the right to sell and is not offset by the short position in the underlying assets. The naked put and the naked position has both loss and gain deals to it and they rely on the underlying security. If the underlying assets are handled carefully they can lead it to the right and profitable direction and on the other hand it goes to the wrong direction. The naked put is also known as the uncovered puts. The investor can prefer the direction.

Previous Post
Newer Post