2. Covered Put Strategy Name: COVERED PUT Direction: Bearish Max. Risk: Un Capped Type: Income Volatility: N/A Max. Reward: Capped Proficiency: Advanced Legs: 1.Short the Stock (Future) 2. Sell OTM SP Puts

3. Entry Make sure that trend is downward or sideways. We are entering into this strategy to cover the short position and in addition to that we collect the premium. Trade Management: This is covered strategy, so we can expect limited profits even the stock moves lower. If the stock moves lower, you would have two options either you close short stock and collect the profit or close the put and sell another put. Always covered the short stock with the ATM puts in upward trend.

4. Risk Profile : Net Credit: Put premium Max. Risk: Uncapped Max. Reward: (Stoke price-strike price) + put premium received BEP: stock price+ premium received Investment: Span Margin ROI: Profit/Investment

5. Example: Month Long/Short Option Call/Future/Put Price Qty Oct Short - Future 5750 1000 Oct Short 5700 put 69 1000 Net Credit: 69000 Max. Risk: Uncapped Max. Reward: 116000 BEP: 5722 Investment: 1051000 ROI: 11% above 5722