🖋 Put Writing

The put writing strategy gives the seller of the option the obligation (not the right) to buy the Underlying Asset at a specified Strike price on a pre-determined specified Expiration date.

Users will need to deposit a cash token (e.g. USDC) into the vault.

The Strike price for the vaults are mathematically and/or algorithmically (wherever supported by oracle data) selected to optimize the user’s position.

Investors in the vault will receive Premium from the sale of the options.

At expiration:

If the Underlying Assset is at or falls below the Strike price, the investor (seller of the put option) may be forced to buy the Underlying Asset at the Strike price, hence being exposed to potential downside risk. If the Underlying Asset appreciates above the Strike price, the put option expires worthless.

The vault auto-rolls the invested notional (including any premiums received/withdrawn as applicable) into the next vault at the end of every settlement cycle.

Risk Level: 🔥🔥🔥 / 5 (Moderate)