7
votes
3answers
1k views

Am I understanding buying options on stock correctly

I'm just wondering if I am understanding Stock options correctly. Basically if I am watching stock XYZ. It's currently at $10 per share which I believe is low and should raise to 20 within 1 month. ...
1
vote
1answer
108 views

Knockout certificate (Long) fell more than 6% even though the underlaying security rose 1.2%

I recently bought a knockout certificate for facebook. So far it has been doing great returning more then 200%. But recently it has been doing something really strange. On Friday Facebook rose 1.2% ...
1
vote
2answers
101 views

Can I convert spread option into regular call or put?

I have bought spread call on stock X. After that point, the stock went up and came back. My short position is the same price as it was when I bought it 1 month back. At this point If I just clear out ...
3
votes
3answers
257 views

What is the best way to make a bet that a certain stock will go up in the medium term?

If I want to make a $1000 bet that, say, a share of AAPL will be $1000 in a year's time, what's the best way to do that? AAPL is over $600 today, so with my $1000 I can only afford to buy one share. ...
2
votes
2answers
505 views

how do I calculate rate of return on call options that are spread

I want to do a leap spread on an existing covered call option. How do I calculate the rate of return to determine if it's worth doing the leap spread?
4
votes
2answers
103 views

How it actually works? Selling a call on a stock I hold, but has done poor, might the market thinks may rise

I currently own a little over 500 shares of a stock which represent a hefty on-paper loss for me. I don't want to liquidate the position. I think that long term that stock may come back up as in the ...
2
votes
2answers
775 views

Do stock option prices predicate the underlying stock's movement?

I am trying to understand if my thinking is correct or not. I am looking at a stock that is @ $10.00. When I look at the options on the stock $11, $12... calls are all down today and $11, $12... ...
11
votes
4answers
290 views

Covered Call Writing - What affects the price of the options?

A little while ago, I bought $800 worth of stocks and sold about $200 worth in call options against the stock. I think it was 200 shares and 2 contracts (so my options weren't naked). That takes the ...
29
votes
10answers
18k views

Options for dummies. Can you explain how puts & calls work, simply?

I never understood Puts or Calls. Could anybody explain it like I were a child?