SELLING PUT OPTIONS Tutorial on SaxoTraderGo. A Step by Step Guide
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- Опубліковано 7 лют 2021
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Following on from my video on how I get paid to wait for my investments. Today I am going to show you exactly how to do this inside of SaxoTraderGo platform. This is the Brokerage account that I use and I think they have one of the best and simplest platforms to use.
If you have a different platform, try and apply these same steps to your platform. If you have Interactive Brokers, I will be doing a tutorial on that soon as well.
If you don’t know what a Put Option is, please go back and watch my video called, “Selling Put Options - How I Get Paid to Wait Like Buffett and Phil Town”. There I explain what I am doing and what the point of this is.
Ok, let’s now jump into SaxoTraderGo and go through the steps one by one.
Check it out.
Hit the like button if this helped you with selling put options in Saxotradergo. Subscribe to my channel so you don’t miss future video’s and I’ll see you next time.
Thanks for the video.
I'm a newbie to options.
I'm studying an options course.
It's very confusing at this point.
But this is how we learn. I will press on.
Good day Andrew, thanks for the video.
Glad it helped 🙂
you had me at "... like Buffett and Phil Town"
haha, thanks. I think Burry does it too :)
If anyone was confused, he got bid-ask wrong: bid is the price of the (dearest) buyer of the contract, ask is the price of the (cheapest) seller
Sorry for the confusion. Thanks Dimitri for adding clarity. 🙂
True, but when on the perspective of a trader, you buy at the Ask price (also called raising the ask) and you sell at the Bid price (also called hitting the bid)
@@velvethamster9809 Correct, so he did not get it wrong. Just from another point of view. Both are correct.
Hi. How do u decide the premium desired within the price range; ie why close to the Ask or at the Ask itself?
I really like the platform tutorials. do you already have a vid doing a high level comparison of the major platforms?
I do, it's called "Interactive Brokers Review - Client Portal PLUS Fee comparison" I mostly talk about the fees.
Oh my... in Brazil we get 7.9% in a month loll... Nice video... Thanks Andrew!
Hey pal. Good vid. Would suggest adding the importance of buying into volatility for juicer premiums 😉
Hi, yep agreed, in my previous video I mentioned that concept.
Hi Andrew, very helpful. Do you have more recommendations [updated] of which Co to buy?.
Hi, well it depends on what companies you like. But for me, I have been selling put options for Etsy and Alibaba. Getting good premiums on companies I would happily purchase and hold for the long term
Hi Andrew! Thanks for the great work here! You can consider adding links as to how those who appreciate can show their support for you :)
Hi, thanks for the kind words. Links for what?
@@AndrewBrownInvestingLinks of appreciation to Patron or channel membership perhaps!
Just a thumbs up and a thanks in the comments is more than enough. 👍 I'm not doing this for money
You don't get paid to "wait" when selling puts, you get paid for the upside you are selling (identical to owning a stock and selling covered calls)
I don't think it's the same, as a long term investor, I actually want to own the stock and not be limiting my upside. It feels like I'm getting paid to wait for the price I want to pay. I don't have limited upside. Can you explain if I'm wrong?
why cant i sell call option on saxo even though im holding the stocks???
Hi Andrew, Thanks so much for the video and explanation! Have you ever done Covered Calls before in Saxo? If so, can you do a video about it?
Thanks!
Glad it helped. No, I haven't done covered calls before. That doesn't fit with my investing style. I'm hoping to not sell my investments unless I have to
@@AndrewBrownInvesting why? You can do weekly or way OTM covered calls. Cost you almost nothing (0 margin utilisation) and you can scrape up some free pennies every week.
@@AndrewBrownInvesting Thank you for this video, really useful. About the covered calls, is it possible for you to do it using a demo account or just demonstrate without clicking the confirm button on your trade ticket? Saxo should be paying you for providing this easy to understand video 😀
Hi Andrew, thank you for the tutorial. I wish to know the impact should the share price higher/ lower than the strike price of 215 dollar after the expiration of put options?
If it finishes higher, than the put option expires. You don't do anything. If it finishes lower, you have to wait for the person who owns the put contract to either sell you 100 shares or not. It is all done automatically and you don't have to do anything. You either will get the 100 shares or it will expire. Great question
@@AndrewBrownInvesting Thank you for your answer. Much appreciated. Subscribed to our channel!
Looking forward for more videos!
I like this guy
😂
Awesome vid Andrew, thanks ! Does it also work with put warrants ? I'm not too sure of the difference.
Great question but I have no idea, haven't got that far. I focussed on put options. That was enough for my brain for the moment. 🙂
@@AndrewBrownInvesting Ahah, OK Andrew ^^ By the way, something I'm not quite sure yet about the selling of puts. What about the expiry date ? I know some people have had major losses revolving around that. If I undestand well, that would be the buyer here, if he/she wants to actually sell you the stocks. In your case, is there anything you should (or can) do until the expiry date, except to wait and see if you either only get the premium, or get the premium + buy the 100 stocks ?
@@havrenne great question, I'll know on the 19th of Feb when my first put expires. I'm still testing. So I'll know soon.
@@havrenne It's awesome trading with ETHICALMOBILE on Instagram. Indeed your trading rates are awesome. I will always recommend ETHICALMOBILE on Instagram for a better trade
Good video. I'd suggest a video about how you could trade it again (not that this a good idea!) But good to know you can
What do you mean 'trade it again'? Do you mean, after expiring?
I was wondering what SAXO offers for option trading. Apparently the answer is "not very much", just basic option chains. Though the summary page, which details the nature of the contract (including last trading date) is nice
Yep, pretty limited options market. But that's ok. Not a big deal.
how to set the leverage, like 1:5 or 1;10 in saxo bank? thank you
Be careful with leverage. I would advise don't use it. And I don't know how it works with saxo as I never ever use leverage. Important question, thanks
can you go through what all the figures mean when you have a position open?
Amt - this is the amount of options you have 1 = 100 shares
Pos open - price you got for the option.
Close - Current price at last available moment
Market Value - for selling put options, this will be negative and slowly make its way toward 0, if it is going to expire. If it is negative after expiry, then it might be executed.
There are lots of other columns but these are the main ones I think.
Hope that helps a little, but nothing helps more then getting in their and figuring it out yourself and testing. Thats what I did.
Nice video, thanks. I've been playing around with SAXO demo account. What I see is that there is very little available for options on Australian shares. Do you know of any broker that lets you sell options on Australian and also US shares?
Great question, but I don't know. I haven't been able to find an options market in Australia either. If you find out, let me know.
Commsec lets you buy options to open and sell to close. Also lets you sell puts to open as part of a covered call but you need to own the stock. Can't sell cash-covered puts the way that you show in this video. Also very expensive. It's strange that the options market seems so weak in Australia.
Can you make a video on covered call on Saxo platform?.
I don't think covered calls are a good strategy. It is something I have never done and don't plan on doing it. It isn't my investing style. Sorry I can't help you here. I wouldn't know where to start
Good video. What are the fee associated with a CSP? If the option is exercised by the buyer, is the total cost $6( 3$ to open the option and $3 to close it)?
My understanding is exactly this. But I haven't closed a position yet, so I'll confirm very soon
@@AndrewBrownInvesting for this reason I am thinking about starting at IB. I started a demo account at saxo, just to understand the fees. But it is with margin, so it is hard to understand.
How can I reach and know more about your broker, as a forex trader, thanks
Hi Andrew, Will you do another video like the Q3 portfolio video on the 18th of october? I would love to see that!
I am very curious about the mysterious stock you talked about. Will you do a video on that specific stock please?
This would both meen for great content!
Yes I will do a video on these topics. Thanks for the reminder. I'm a little late on the update as I had a lot of other topics I wanted to get to. Good reminder thanks. Ill have it for you soon
@@AndrewBrownInvesting Thank you for the reply, that sounds amazing!!
would love some more examples of selling put options on saxo
I don't have plans to make another video on the topic. But i think you can get a demo account and to practice.
So basically I need $21,500 to cover 1 Put option at a strike price of 215. It sounds like a lot of capital is sidelined to cover your contract. I supposed if you're already holding that much cash its a good side bet to make. However, most people don't have that much money to sideline. If your cash position is 25%, would you recommend this option contract cover only a portion of your total cash position and if so, what percent of cash position should it cover? Example 50% Therefore you should have $43,000 in cash.
Exactly right. $21,500 is what you need in cash. It is a lot of money. And yes about 50% of your available cash tied up in out options is a good balance. It's about what I am doing. Good thinking
How does the option selling actually work? I guess you need to have required margin, but can you use the money to trade, or are they locked? if you have 10.000 dollars and margin requirement on stock is 6.000, does that mean you can sell only 1 option? And if you get premium 3.000 dollars, do you get it emedietly after the sale? Can you use part of the premium money as margin requirement? If you want to hedge on selling call option by buying 100 shares, can you use the money in margin requirement, or not? I need more detailed video for this, which includes full process sell with account ballance and more info
I have an entire video explaining selling put options.. Check that out, and hopefully that explains things clearly. Glad you found my videos :) hope this helps. Video name - Selling Put Options
Thank you for the great video Andrew. I have a question : if the strike price is hit when we sell the Put, will Saxo buy the share automatically and put them in your trading account ? Is there any additional cost they charge for that ?
Great question, it hasn't happened to me yet, so I have to wait and see. I think normal fees will apply so probably a few dollars.
@@AndrewBrownInvesting Thanks Andrew. I will try and also let you know
Hi Andrew, when you sell a put option on Saxo, do you pay interest on the margin they require to store, or is there a way around that? I tried to sell a put myself, had more than enough cash on the account, Saxo still tapped into my margin.
Good question, the same thing happen to me. I don't have an answer yet, but I'll try dig into it.
@@AndrewBrownInvesting thanks for getting back to me. I tried to look deeper into it and it seems to be a part of their system when you "only" sell a put option, which I think is weird when you hold enough cash on the account. But it seem that other option strategies don't require them to cut into the margin.
@@Starterman It probably is just the recording because it is a naked put. I'm not worried about it at all.
@@AndrewBrownInvesting Hi Andrew, did you manage to find out the answer for this?
Hi may i know minimum deposit for saxo
I think $10k USD, but it depends on what country you are from. I think less if you are from Singapore, USA etc. For me it was 10k
Hey Andrew, what do you think about Genworth Financial. Price to book is 0.13, price to free cash flow 0.95, price to cash 0.66, peg 0.82, debt to equity 0.24
Would be interesting if you can make a video about Buffet's 'cigar butt' investing.
Never heard of them, numbers look cheap. Maybe too cheap. I'll have to dig in a bit. How did you find this?
@@AndrewBrownInvesting Just a stock screener, screening for value. It's a small-cap so mispricing can happen but I might be missing something...
I haven't looked yet, but I'll need to go back into the history of these numbers. They could have had one off event happen, (like a sale of a particular asset) that has been called earnings. Therefore the financial ratios will look abnormally good.
@@AndrewBrownInvesting Just read that there is a merger offer on the table for 2.7B, the market cap is 1.9B
@@user-mc6yz3rq1g I see that too. This one is really hard to understand the actual assets. A lot going on here. I think they are in trouble and it's going to be beyond my skills to work out if there is anything valuable here.
I sold a put option collected the premium. Now the strike price and share price are hovering. Last few days its gone over the strike price but its also dipped. The shares havent been assigned.
My put option expires on 28th January on a US stock. When is the limit to when i am allowed to close it. ?
Sorry for writing you, just out of curiosity your page come up on my suggested friend lists so I was just wondering if I knew you from somewhere??
Personally I prefer CedarFX
fair enough
Wait, Intel 88days is $3.51 for $40 strike price? I'm looking at their options right now, and Jun 18th, $40 put is $0.35 (130 days from now) - that's annualized return of 2.48%
Yep, it was. Changed a lot. There is a lot of movement in the options world
Another highly educational and to-the-point video Andrew! Keep up the good work!
A few questions and an observation:
Question 1: When I log into Saxotrader and try to see the option chain for almost any of the stocks in the exact way you are showing, it simply says "Option chain is not available for this instrument". What am I doing wrong?
Question 2: What do "Margin Impact" and "Open Interest" stand for?
Observation: I would also additionally add a column in your excel that tells me days to next earnings for the stock. And then if I have multiple stocks who are giving me a 7+% return then I'd choose the one whose relevant strike price date is not beyond the next earnings date. This way I would hopefully avoid volatility to some extent and thereby minimize my risk :-)
Question 1 solved, I had to give a quick "exam" on Saxo for enabling options trading. Maybe please mention this for other new viewers :-)
Oh and perhaps you can please also share that excel? :-D or pls send me an enrolment link to your course and I'll happily pay for it :-D
Glad you worked that out.
Haha no courses, sorry. But Send me an email, by replying to the intrinsic value calculator in my description. I can the send it to you there
@@AndrewBrownInvesting awesome mate, just emailed you now :-)
Is SaxoTrader available in all European countries?
No, not all. Mostly western europe
So you lock 21k for 72 days to make 320 dollars profit.. Seems like a bad deal?
8% annualised. I don't think is that bad, considering I'm getting what I want.
@@AndrewBrownInvesting As long as your are happy with the returns then that's cool ;)