I hold a profitable in-the-money call that I want to hold until expiration in order to lock in the highest return. I am unsure exactly what the broker's process is when an option expires with value.
I assume that an exercise is triggered which would mean my account would acquire 100 shares of the underlying stock per contract. At what price are the stocks acquired? Is it simply the strike price or is it the market rate? And are these shares then instantly sold with that value added to my account balance?
Edit: For example, say I own an XYZ $100 call which I bought when XYZ was $75. The market price is liable to fluctuate due to the volume of trades but suppose it's roughly $125 at expiration. At expiration, would 100 shares be deposited in my account at a cost to me of $100 per share, and would they automatically be sold at some rate on the market by my broker?
Please feel free to challenge any assumptions I may have made in my post, I'm a complete beginner so maybe I have made some mistakes!