Questions tagged [call-options]

A call option is a contract giving the owner the right, but not the obligation, to buy a specified amount of an underlying security at a pre-determined price within a specified time frame. Related tags are icall-options, options, options-assignment, option-exercise and should be used when appropriate.

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58 views

When it comes to options, is there a “house” like with a sports bet bookie?

While learning about options trading, the following question came up. I'm hoping someone here can help answer it. Please excuse any (likely) imperfect terminology and understanding. Are call and put ...
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57 views

Very high strike price for call option (GME)

I noticed that there are many call contracts on GME at a strike of $800 that expire in 5 days. Currently the price of GME is at $110. I'm just wondering why anyone would go for such a high strike ? ...
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when do you decide if to execute an option?

I own a call option that expires on Friday. When do I decide whether to execute the option? The Saturday after?
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141 views

Wheel strategy (cash covered puts and covered calls) for an annual income

I'm curious if there's anyone selling cash covered puts and covered calls for income. If so, what is your monthly gross return in percent and how long have you been doing it? I'm considering selling ...
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Would my shares be sold if the price expired at above my call spread?

I own 100 shares of XYZ. I sold a call option on XYZ at a strike of $100. I bought a call option on XYZ at a strike of $110. The price of XYZ expired at $120. Will my 100 XYZ shares be sold and a ...
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Strike price confusion

I am reading a document that says The seller of 10 call options, with a strike price of 400 at CHF 8.00, (contract value 10), has the following risk What does 400 at CHF 8 mean? i.e. I understand what ...
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39 views

Do the people that sold naked calls that expire in the money have to settle up at the closing price on the day of expiry?

If a naked call expires Friday does the issuer of that call have to pay the 4:00 Friday price for the 100 shares or can they wait for a better price after hours, or the next day before settling?
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72 views

Can you sell out-of-the-money option on last day of expiration?

I have a $500C Jan 29 GME option expiring tomorrow. I bought it when this contract was at $9.30. If the stock goes to say $400 or $450 tomorrow and the stock price is still under my strike price of $...
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122 views

Trading with options and turn in profits

Yesterday I read an article about how someone was able to turn $ 200 into $ 113,000 in just one day by buying call options on a particular stock. The article also showed a screenshot which appears to ...
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48 views

2 questions about puts/calls/shorting

I have 2 questions about puts/calls + shorting in my learning about options. I'm confused about how "short selling" a stock is the same/different as "writing a covered call." In ...
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36 views

Option Premium Increasing Toward Expiration

I understand that premium pricing is dependent upon a few factors like intrinsic price and time value, the latter being affected by volatility. But as I look at my risk profile in thinkorswim on a ...
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Does exercising an option count as a gain?

I’ve always only sold options that I’ve had in the money. Of course sale of an option is income and will be taxed as such (assuming it’s been held <1 year). Now, for the first time, I’d like to ...
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48 views

Is american call option exercise taxable event?

Since best to my knowledge the premium paid for the call option has to be added to the strike price to calculate the post exercise stock's cost basis, I assume that the answer is "No, exercise is ...
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36 views

Tax treatment of call option that expires in the money

Suppose I buy a deep-in-the-money call option, it expires in-the-money, and I take delivery of the underlying stock at the strike price. Will a realized loss equal to the premium of the option be ...
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101 views

How to ensure that my shares are never sold when I write call options?

I own shares of stocks and ETFs that I plan to own for the long term (so as to avoid the short term capital gains tax). I also want to sell call options on these shares. I understand that the buyer of ...
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Option Price Chart Data Not Matching with Table

I am studying the option price data for SPY Call Credit Spread 373/372 expiring Jan 15, 2021. According to this chart, on 12/24/2020, the price ranged from -0.87 to -0.02. At least that is what I ...
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32 views

Implied Volatility, % Change in the Option Chain

The following is the Options Chain of CRM (Salesforce) for March 19, 2021. A few questions from the chart: What does the % Change mean in this chart? What does the Volume mean? At the $300 strike, I ...
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Option Value dropped in 8 days even if the underlying price is the same

This is the Option Chart for TSLA JUNE 18 2021 $1050 CALL. It was bought for $47.50 per option. The underlying price was $645 when it was bought. Now after 8 days, the option value is $33.25. The ...
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32 views

Vanilla options on major US equity indexes – what is the best way to buy them via individual brokerage account?

Please help me with two questions: What is the best way to buy plain vanilla options on US large, mid, and small cap indexes, such as Russell. I’m looking for some actively tradeable options with ...
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450 views

Option Value going lower even if the Price of the Underlying stock goes high

Trader bought a one month $150 strike CALL OPTION on stock XYZ that is trading for $150. He paid $500 for the contract. After two days, the stock's price is $160 but the trader sees that his contract ...
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1answer
177 views

Does selling an OTM covered call affect the holding period of the underlying stock?

Given the following, ignoring commission, etc.: On 2019-03-16, XYZ is trading for $100.00. I purchase 1000 shares, for a cost of $100,000.00. On 2019-09-15, XYZ is trading for $150.00. I sell 10 XYZ $...
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225 views

Slack - Salesforce buyout, What happens to the Options?

I hold three call options of Slack. Average price bought: 15 * 3 = 4500; Book Value: 45 The current price for each call option is $18, and the stock is trading at $43. According to the press release:...
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71 views

What is the size of lot for options listed in Yahoo finance?

I am wondering what is shares lot size of options for any stocks in finance yahoo list. For example in this particular AMZN call option ask price is 251.85, expires in March 2021, and the strike is ...
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57 views

Trying to figure out how much I would make from call option

I bought a BABA call option this morning. $277.5 call, $2.87 price, expiration date nov 27. The contract is now worth $4.80. If I sold now would i make $210? (4.8 * 100) - (2.87 * 100). Also, it says ...
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33 views

Options move differently when underlying goes up vs down

I have been researching options and I have noticed that call options move differently when the underlying goes asset up vs. down. Mostly negatively for the investor. For example, I have narrowed my ...
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179 views

Low Strike Price Call Options strictly superior to stocks?

I was looking at AAPL $40 Call Options for Jan 2023, and I noticed that the break-even price is +0.35% of current. AAPL is trading at around 110$ at the moment. This means I could increase my exposure ...
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1answer
27 views

Binomial option pricing model. Comparing prices

I want to ask a question that may be too obvious for some of you, but: I calculated the price of a call option (expires in 7 months) using binomial pricing model and it is significantly lower than was ...
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Options trading and arbitrage [closed]

Near market closing time on a given day, you lose access to stock prices, but some European call and put prices for a stock are available as follows: All six options have the same expiration date. ...
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61 views

How does an option's premium depend on its strike price?

(NB: In this question's title, and elsewhere throughout this post, I have used the word "options" as a stand-in for both "call options" and "put options", for the sake of ...
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58 views

What is the last possible time to exercise an equity option traded on CBOE?

I own 100 shares of AAPL an I am short the Oct 9 2020 $117.50 call. As per this CBOE link, the long holder may exercise that contract at any time before the contract expires, up to and including the ...
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60 views

Would a call option with one strike price be worth more than a call option with two different strike prices?

For example, say there is a call option with a strike price of $50 for a stock. Now, say there is another call option for the same stock with a strike price of $50 if the stock price is below $60, but ...
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138 views

Lifecycle Investing through index options

I'm a young DIY investor who is looking for ways to consistently implement the approach outlined in the Lifecycle Investing book by Barry Nalebuff and Ian Ayres. In short, they suggest using moderate ...
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238 views

How not to pay taxes on covered call

I bought 100 shares of ESPO four months ago for $50 and sold a September 18 $62 covered call at Robinhood. With the stock trading at $61.50, I think that it's likely that I will be assigned. I will ...
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134 views

Lot size for NASDAQ Equity options

I'm going to trade in NASDAQ equity options, please share link where I can find lot size of each equity option contract?
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3k views

How is it possible that these deep ITM stock options on DISH went from 52,000 volume, 550 open bids, 550 open asks to being completely dead overnight?

I bought 16 years of historical hourly stock options data for my personal investment study to test how particular strategies may have played out over a long period of time. I'm looking at the data for ...
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1answer
202 views

Stock Option expiring before the announced acquisition, help!

I recently bought 17 Livongo $150 call options that expire on Aug 14th. LVGO closed yesterday at $144.53. This morning they announced phenomenal earnings and shares reached a high of $167.88 in the ...
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1answer
169 views

Prices increases leading to call debit spread loss

I recently entered a debit call spread on Apple and I noticed the price of the sold option appreciated at a faster rate than the bought option resulting in a loss even though the stock moved in my ...
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87 views

Does increasing value of a still-out-of-the-money option that you wrote (covered) pose a risk to you?

I am a US citizen living in the US. I want to write covered call options to receive premiums. If implied volatility increases and/or the price of the underlying rises, an out-of-the-money call can ...
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1answer
59 views

Can day/week traders take profit from Volatility only?

Assume a stock varies between the prices $40 and $45 every three days, and the current price is $42. The trader buys 1 CALL Option contract for a strike price of $60 that expires in a month. Can this ...
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138 views

How the traders take profit from options that has too far Out Of The Money strike price?

Looking at the Amazon Options on this Yahoo page, there are 121 options interest for June 17, 2022 for the strike price of $5000. Assume that some traders bought the options when the stock price was ...
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93 views

Confusing loss on closing options spread

Today I closed a spread on $TSLA, specifically a 3x bull call expiring Aug 7th, 2020. The spread was composed of 2 legs as : Buy 1330 call Sell 1360 call My P&L on the trade before closing looked ...
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107 views

Unable to transact with OXY LEAP

I had bought long-dated Calls on OXY. Something happened around a month ago where the ticker I started seeing in my IB app turned to OXY2. Today I wanted to sell it and it seems the contract is no ...
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50 views

Help understanding Collar strategy

Could someone explain the drawbacks of this option collar strategy on PPL? It looks to me that there is minimum risk. I use Robinhood for my trades and pay no commissions/fees. Buy 100 shares for $...
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90 views

What to do with a call I sold

I own 300 shares of NCLH, I sold a call last Monday with strike price of $16 when the stock was at $15.8 for a premium of $115 (for the 3 calls). The Call expires tomorrow and I don't know what I have ...
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31 views

Order Type to sell options a few days before the Expiration

With the stock at $175, a novice trader buys 1 call option: Option Price: $20 Strike Price: $200 Expiry: December 15, 2020 Cost: $4,000 He wants to SELL TO CLOSE the option on December 1st, 2020 ...
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308 views

What will happen if CALL OPTION expire IN-THE-MONEY without sufficient funds?

Suppose a novice trader opens an online account with $5,000 with online trading platforms like e*trade, Ameritrade or Robinhood. With the stock at $175, the trader buys 2 call options: Option Price: $...
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Does option “automatic exercise” take commission into consideration?

Automatic exercise is a procedure implemented to protect an option holder where the Option Clearing Corporation (OCC) will automatically exercise an "in the money" option for the holder, ...
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380 views

How long does it take to exercise an option?

If I have a call option and exercise it today will I be able to receive the shares immediately to sell them?
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124 views

Adjusted Options (Long Calls) on Expiry

I bought Long Calls (options) almost a year back. This trade was made in 2019: CHK210115C3.5 Strike price $3.5 Underlying symbol:CHK Expiry: Jan 15 '21 After CHK underwent a 1:200 reverse split two ...
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Can you borrow shares from broker to cover naked call?

If I sold a naked call, and the buyer exercises it. Can I borrow the shares from the broker to fulfil it?

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