Below is a great article that was on Gurufocus describing some of Warren Buffett’s past sales of naked put options. This is a strategy we use extensively at T&T Capital Management and we believe it is akin to Buffett’s “workout” strategy, which he used when he was running the Buffett Partnership L.P. The L.P. was one of the most successful investment partnerships in history and occurred before stock options existed but Buffett used situations such as mergers and acquisitions to obtain investment results that aren’t directly correlated to the overall market. This is why the partnership was positive every year despite several negative years for the Dow during that time period.
http://www.gurufocus.com/news/256254/naked-short-put-options–warren-buffetts-little-secret