It is not short puts. It is not even short strangles. The position that keeps experienced traders up at night is the naked short call, and Jim Schultz thinks most traders treat it as a mirror image of a short put when it is fundamentally different. No positive drift to bail you out, no skew pumping up the premium, and no ceiling on the loss.
Jim ranks it as the most extreme undefined risk strategy on the board, then walks through when it can actually make sense, why indexes are safer than individual names for this setup, and the sizing and management rules that keep it from blowing up. Three to seven percent of buying power, a loss plan before entry, 50% profit target, and roll at 21 days. Use it sparingly, pick your spots, and never go hog wild.
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