Usually, when I sell puts, I’m not that enamored of the possibility of taking possession of shares.
Really, all I care about, whether buying shares or selling puts is just how much income I can generate from the position and how much risk is associated with the income production.
When selling puts, I especially like being able to roll them over, just like has been the case recently with Cliffs Natural Resources, where I have some puts that expire next week and that have been rolled over since mid-December, or so.
During that time there were more than a few occasions at which it was looking pretty bleak, but as with most stock positions, if you can wait long enough the good becomes bad and the bad becomes good.
Sometimes, though, it does make sense to take possession. read more