Is the PUT option position automatically closed when the loss is equal to margin?

[danielk]

Hi, I have an PUT option position opened that is starting to loose money. Is that position going to be automatically closed when the loss is equal to the margin?

I have some extra funds that I don't mind risking on my bet so I would prefer to keep the position opened. 

 

[OfentseIG]

8 hours ago, danielk said:

Hi, I have an PUT option position opened that is starting to loose money. Is that position going to be automatically closed when the loss is equal to the margin?

I have some extra funds that I don't mind risking on my bet so I would prefer to keep the position opened. 

 

Hi @danielk

Thanks for reaching out. 

If you buy options, the maximum loss is your premium (margin). Options are cash settled. You have the option to exercise it before expiry or leave it until expiry. Nonetheless, the maximum loss would still be your premium regardless of where the strike price is. All the best, OfentseIG

[danielk]

Is there a way to increase margin without changing the position?

[OfentseIG]

13 minutes ago, danielk said:

Is there a way to increase margin without changing the position?

Hi @danielk

Unfortunately not. You can increase it only if you take up a higher premium. That would be opening a new different position. Thanks, OfentseIG

[Doris]

Hi @danielk,

How was your position? Still ok?

[danielk]

Hi @Doris,

I'm good till about 4200 for S&P500 (shorting) so I still have some space. 

 

[danielk]

On 02/11/2022 at 13:37, OfentseIG said:

Hi @danielk

Unfortunately not. You can increase it only if you take up a higher premium. That would be opening a new different position. Thanks, OfentseIG

Hi @OfentseIG,

Just for the future, how do I open a new position with higher premium? Is there any instruction for that?

[OfentseIG]

10 hours ago, danielk said:

Hi @OfentseIG,

Just for the future, how do I open a new position with higher premium? Is there any instruction for that?

Hi @danielk

I believe that will be if you select a strike price closer to the current market price. This would be a strike price in the money. All the best, OfentseIG