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When You Should Not Roll a Short Put
Rolling is useful only when the replacement option is attractive. It is dangerous when it becomes an automatic refusal to accept a loss.
Do not roll a broken thesis
If new information changes the business case materially, extending the same bullish exposure can compound the original mistake.
Do not roll into excessive concentration
A new option can keep sector and single-name exposure elevated for weeks longer. Portfolio concentration can make an otherwise reasonable roll inappropriate.
Do not roll just to show a credit
A net credit is an order-ticket outcome, not proof that expected return improved.
Do not roll into a bad expiration
A replacement expiration containing earnings or another major event can introduce risk that was absent from the original trade.
Do not roll beyond your capital plan
Additional time can tie up buying power and reduce the ability to respond to broader market stress.
Accepting a loss can be disciplined
Closing a trade that no longer fits the plan is not a failure of the strategy. Refusing to close can be the larger risk-management failure.
Use a written options process
Define winner management, time exits, loser decisions, assignment capacity and portfolio limits before the trade is under pressure.
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When to Close · 50% vs. 80% · 21 DTE vs. Profit Target · Tested Strike · Roll vs. Assignment · Rolling for Credit · Early Assignment · Expiration Risk · When Not to Roll