In my margin enabled brokerage account and I have $100k of my cash (not using margin) invested in individual stocks such as apple, msft, nvidia, netflix, spy and others. I intend to hold these stocks for a few years.
Now I want to generate \~$1000 (1%) each month on this $100k and I am considering selling naked put leveraging \~50% ($50k) of the margin available.
I plan sell naked put with 30dte on the below. These are some of the stocks I don't mind holding for a long period of time if they get assigned in the worst case.
https://preview.redd.it/q0ohk6i7d8dg1.png?width=1216&format=png&auto=webp&s=5ab9af8dd95a4ffbb6129d3a2066c1595f17f659
Questions:
1. I am selling naked puts for a total notional value of \~$250k. I believe the margin requirement for this would be \~50k. Is this understanding correct?
2. This strategy sounds pretty safe to me considering the naked puts are diversified, low delta and expiry is 30 days out. I am also fine if some of these get assigned. Am I missing something when I say it's a safe strategy? Let me know if I am missing something obvious.
3. In the worst case, let's say all these get assigned. Since I have $0 cash balance in my account, my understanding the broke will buy $250k worth of stocks on margin. What happens at this point? Do I get a margin call? Does the broker try to liquidate my existing $100k worth of stocks or the newly assigned stocks? I am not familiar with this part since I am new to margins. Please explain with the specific numbers if possible. Are there any simulators to calculate what happens when the assignment happens?