[Toddsterpatriot]

ABC is trading at $100.50 and trending upward. Instead of buying it via a stock trade I sell an in the money put for $100 (for $3), which automatically executes and my basis is $97.5.

First of all, at $100.50, your $100 put is 50 cents out of the money, not in the money. Second of all, your basis would be $97, assuming it closes on expiration below $100 and you get assigned. If you were right, and the stock keeps going up, you keep your $300 and if the stock goes up to $150, well, at least you got to keep your $300.

[Vision]

Thanks. Let me back up. Should you use options to enter and exit stock trades to reduce basis?