Rolagem de Put - Como Fazer um Bom Manejo Para Salvar Sua Posição

Summary

In this video, the speaker discusses strategies for managing sold put positions in a high-interest environment, where premiums are low, and the risk of being exercised increases. Two key techniques are shared: the first involves using calls to cover the cost of rolling over puts, while the second suggests gradually increasing exposure through strategic rollovers to reduce the cost basis. The speaker also presents a secure method for beginners by using long-dated puts combined with shorter, sold puts for partial coverage. The goal is to mitigate losses and manage risk while aiming for profitability in volatile market conditions.

Takeaways

• 😀 Avoid selling puts when interest rates are high, as they become too cheap and the risk outweighs the potential reward.
• 😀 When puts enter 'in the money', rolling the position can become negative, and it may not be worthwhile to assume the asset at the strike price.
• 😀 There are two main strategies for handling sold put positions: rolling positions to the next expiration or increasing exposure in a controlled manner.
• 😀 To minimize risk, any adjustment to your strategy should avoid leveraging your capital and should provide an actual improvement in your position.
• 😀 If you are rolling puts and the premium does not cover the cost of the roll, you may end up losing more than you gain, potentially falling below the CDI rate.
• 😀 In some situations, selling calls can help fund the cost of rolling puts, without increasing risk in your position.
• 😀 When rolling positions, you may need to sell calls in the same expiration to cover the cost of the roll, but you should monitor your exposure closely.
• 😀 For those who start with a small exposure in puts, increasing exposure by doubling the position can help lower the average strike price in a falling market.
• 😀 When you reach your exposure limit with puts, no further adjustments can be made, and you will have to either close the position or assume the underlying asset.
• 😀 In extreme cases where the market drops significantly, it may be necessary to go short on the asset to stop further losses from the options position.
• 😀 The safest way to sell puts is to buy a long position in a deeply in-the-money put with a long expiration, paired with a short position in a nearer expiration to protect your portfolio from drastic moves.

Q & A

What is the primary challenge when puts enter into the money in the current market conditions?

The primary challenge is that when puts go into the money, rolling them becomes negative, meaning that traders might not want to take on the stock at the strike price, especially when the stock is cheaper in the spot market. This leads to complications, particularly for those managing sold puts.

Why is selling puts not recommended when interest rates are high?

Selling puts is not recommended when interest rates are high because puts become very cheap, and the premium may not justify the risk. Additionally, the likelihood of being exercised increases as the market continues to trend downward, making it a more risky strategy in such a scenario.

What are the two basic requirements for handling a negative roll in options trading?

The two basic requirements for handling a negative roll are: (1) the maneuver should not increase the risk in the structure, avoiding leveraging assets, and (2) it should effectively improve the situation, ensuring that the reward justifies the cost and opportunity.

How does the 'call selling' strategy work to cover the cost of rolling options?

The 'call selling' strategy works by selling calls in the same quantity, with the same expiration, and a higher strike price. The premium received from selling these calls helps to cover the cost of rolling puts. This strategy can offset the negative cost of rolling and extend the position for at least one more expiration cycle.

What is the strategy when you want to increase exposure by rolling puts?

When increasing exposure by rolling puts, you sell more puts as the market moves against you. For example, if you initially sold 100 puts, you could roll them into 200 puts to reduce your strike price and improve your cost basis. This can continue in subsequent months until you reach your maximum planned exposure.

What happens when you enter a maximum exposure position with puts and the market continues to drop?

If you reach your maximum exposure and the market continues to fall, you must eventually accept the stock at the lower strike price, and your position will likely incur losses. At that point, you may need to wait for the market to recover or make other adjustments to your strategy.

What is the importance of entering a short stock position when facing continuous market decline?

Entering a short stock position when the market continues to decline helps stop further deterioration of your options position. The proceeds from shorting the stock can be used to cover the cost of rolling puts and reduce the risk of further losses, providing a temporary cushion while you wait for market recovery.

What is the safest way to sell puts according to the script?

The safest way to sell puts, especially for beginners, is to first buy a long put with a longer expiration, ideally one year out. Then, sell a shorter-term, at-the-money put to collect premium. This creates a partial hedge, reducing the overall risk of the position. Additionally, using an asset like CDI-backed securities for collateral can further safeguard the trade.

How does buying a long put help reduce risk in the options strategy?

Buying a long put with a longer expiration provides partial protection against price movements in the underlying stock. If the stock price doesn't move in the expected direction, the long put's value increases over time, helping offset potential losses from the short puts sold.

What is the minimum guaranteed return when using the strategy of selling long puts combined with short puts?

The minimum guaranteed return is the value of the premium received from the short put, which in the example is R$9.32, regardless of the market direction. If the stock price increases, the potential return becomes unlimited due to the structure of the trade.