Post #9466 by mungofitch on the Berkshire Hathaway board

Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A) ❤

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Why should nervousness and the eventually resulting selling pressure be a reason to write puts?

Another reason is that, as the price slides, the puts that would get you a below-average entry price on the stock if assigned become remunerative enough to make both outcomes nice. i.e., a reasonable rate of "interest" return if not assigned, and a good entry price on the stock if assigned.

An entry of (say) $390 or lower would be very nice, but at the moment the puts that get you that net entry price have a nugatory return if they simply expire. A bit more panic, a bit more price falling, and it would make sense again, as it did August 5.

Jim

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