Oct. 2 at 12:23 PM
Yes. When a put expires itm they convert to 100 shares short at the strike price (provided you have the capital to transition, if not they cash you out at fair value at exp).
So for
$SPWH 2.5p if it’s at 2.30 at exp you either
Exercise each contract to 100 shares short at 2.50 meaning each contract is +
$20 (2.50-2.30 x 100 shares per contract) or cash settle where you just get paid out. You are able to choose before so with your broker.
So in the 2.30 end price example, if you got in the puts around .10 each like me, you’d make
$20A contract, or 100% with either a continued short position, or the $.
If it’s at
$2 on exp, the 2.50ps would be worth
$50 a contract, or 400%ish depending on your exact average (I’m at .10 so
$10 a contract)
@chesterstevens13
