Questions tagged [options]

This tag is to be used for any question on Options, A more specific tag [put-options, call-options, options-assignment, option-exercise] should be used when appropriate.

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Comparing option data between yahoo finance and CBOE for SPY options

In this snippet from an option chart from CBOE website I am guessing that the chart is showing Call Options for Apr 25, 2014 expiry for the Strike of 155. But how come there are so many calls for ...
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How to Calculate the Expected Move of a Stock

I've been trying to determine how to calculate the expected move of a stock, and I've found there are several ways to do this but most of my findings usually lead me to this formula: Unfortunately ...
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What is the gambling difference between sports betting and trading stock market derivatives based on indices?

What is the practical difference in terms of gambling between wagering on the future score of a sporting match and wagering on stock market derivatives based on indices, such as the future value of ...
lurning too koad's user avatar
-1 votes
2 answers
312 views

How to calculate 1 share movement

I'm trying to figure out how much the price of a stock will change if a particular amount of shares are sold at that time. "X stock" is at $100 per share. If I sell 1 share how much will that affect ...
theloosegoos's user avatar
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3 answers
206 views

Low risk hybrid investment strategy

I was learning about options and usage of leverage and I thought about this strategy where from X amount - you invest (X/100 at 100 times leverage) in stock markets and invest the rest (99X/100 ~ X) ...
Mike's user avatar
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IV applied to Buying Vs. Selling Option Contracts!

Is low IV (Implied Volatility) good for selling or buying options?
Youtubecomgoldminemusicinfo's user avatar
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2 answers
114 views

How to get fiat liquidity on BTC assets

I am bullish on BTC and at the same time I need some fiat liquidity right now. Is there some combination of financial products I can use? As an example: I have 10 BTC (assume current FX $10,000) I ...
crinv's user avatar
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197 views

After an option skyrockets in price and IV, when will IV decay and drop?

Consider LEAPS on stocks on BNTX, GME, MRNA, TSLA or ETFs like XSD, SOXX. They've all rocketed in price, and their IV too. Once their IV drops, I'm thinking of buying them. I've been following some of ...
Bad at math's user avatar
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199 views

Why is the terminology "put" and "call" not applicable to futures contracts?

Why is the concept of puts and calls applicable to options, but not to futures? Futures and options are similar, the key difference being that futures represent an obligation, whereas options ...
Victor123's user avatar
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Is Implied- and Historical Volatility based on solely Business days?

I'm trying to compare historical and implied volatility for different stocks. Still, since I can't tell what these numbers are based on (for historical volatility) and referring to (for Implied), I'm ...
Telefondemonen_se's user avatar
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231 views

Can selling naked calls create counterfeit shares?

I understand that illegal naked shorting can lead to FTDs since same share can be loaned out and shorted multiple times. This can lead to a situation where >100% of a stock's float is shorted (Ref: ...
maverik's user avatar
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How to get information about historical stock option prices for a defunct company?

It has previously been asked how to get historical stock prices for a defunct company: How to find historical stock price for a de-listed or defunct company? I would like to know how to get ...
Vivian River's user avatar
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1 answer
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Close an option position after getting an early assignment notice

If I sell an option, and the option goes in the money prior to expiration, and I get hit with an early assignment notice, can I still close out the option after I get early assignment notice? I was ...
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Option Pricing Range

In case of zero transaction fee, the option should have a fixed price determined from c + K - S0 = 0 where c = Call option price K = Strike price, and S0 = Current market price If this is not ...
Pashi's user avatar
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I bought an option it has a volume of 3 it expires two weeks from the purchase date it jumped 650% and drops then rises even higher

I bought 5 options contracts. It goes from being worth $125 then shoots up to over $1,000 then decreases in value when I try to sell. I tried to sell three times while it had a 552% increase, but it ...
Traderjunior's user avatar
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2 answers
463 views

Options trading and wash rule

For example, I buy a PUT option on TSLA for 3000 dollars and realize it's not working and sell it to close for 2000 dollars. Thus I have lost 1000 dollars on this transaction. Within thirty days of ...
Options Trader's user avatar
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1 answer
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Robinhood Stock “Cash Settlement”

I bought a (call) option on AMAG stock and Robinhood send me a message like this: What should I do? Are they going to pay me? The expiration date is 11/20 and I don’t know what should I do. Please ...
Sean Taylor's user avatar
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Is it better to buy the stock over a long call if volatility is high?

I've been looking at buying long calls of $ZM, but when calculating my P/L i'm thinking it's basically a wash to buy the option and might as well just buy the stock. Wondering if this is true or if ...
Catfish's user avatar
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How could this iron condor be profitable if it costs more to buy it back?

Iron Condor I’m uncertain as to how this position can be profitable if it costs more to exit the trade than to enter it. There seems to be a glitch of some sort in the app? Can anyone explain what’...
newtoforex's user avatar
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1 answer
238 views

How much can option market makers influence stock prices?

Do option market makers also hold stock for the options they write? Suppose it's a: $10 billion company $20 stock 23 strike calls @ 30 cents Buy 5000 calls 10 days until expiration I think this ...
Yoshi Onimusha's user avatar
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1 answer
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How to know when to buy a call versus a put through options statistics

Is there a good method or set of methods that traders can use to know whether to buy either a short term call versus a short term put using only numbers provided in options trading?
Mardymar's user avatar
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1 answer
181 views

Buy pre ipo'd start up company stock in small amount? [closed]

Is there any investment website/company through which I can buy small amounts of pre-PIOed company stock in a smaller amount? Most require $100K worth of investment. e.g. as an average investor can ...
Urvishsinh Mahida's user avatar
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1 answer
57 views

Covered puts and covered calls

Why is it not possible to sell covered puts but we can sell covered calls? What happens if I short a stock and short a put?
chrislam5459's user avatar
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1 answer
841 views

Hedging a long/short equity position with options?

If an individual was considering: LONG 100 AAPL shares at 150 SHORT 100 APPL shares at 150 How could he/she hedge the directional risk with options for those two trades? And what would be the ...
gcat's user avatar
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Confusion about trading options

There is one thing I do not get about trading options (let's restrict this to calls), and no online resource I've come across seems to talk about the following scenario. There are 3 parties in this: A,...
ToniAz's user avatar
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3 answers
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Open Interest vs Volume for Stock Options

Wanted to double check my intuition - What if there is only one trading day and the volume is smaller than the open interest on that one trading day. This is assuming there is no open interest before ...
liujm's user avatar
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1 answer
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How does a person with a large equity in a company hedge his risk

How people like Bill Gates , who has the bulk of their wealth tied up in MSFT shares, hedge their downside risk in case the share price tanks? If he were to buy put options like the rest of us, it ...
Victor123's user avatar
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2 answers
229 views

Large volume options sell

In Casino Royale, the villain trades put options worth USD 100 million and loses. My question is say if he had won, would he have been able to sell the USD 100 million worth of options? Say option ...
Turbo's user avatar
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1 answer
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Selling the underlying in case a covered call is exercised?

If I sell an out-of-the-money covered call and the option becomes in-the-money prior to expiry, then am I forced to sell my underlying at the strike price (assuming the counterparty decides to ...
Victor123's user avatar
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How to trade stock e.g, BABA using monthly options (wheel strategy)?

Say you want to buy up to 400 shares of BABA in the current $130 range to $100. How do you implement an option strategy in the meantime to make some extra cash while waiting for a $10 stock gain? Buy ...
surewin's user avatar
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How am I notified a buyer if my option was exercised by the buyer on TWS? How much delay is there from when exercised to when I'm notified?

If I sell a call option out of the money that goes in the money before expiration, and if the buyer chooses to exercise the option before expiration, is there an immediate or delayed notification in ...
salty's user avatar
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2 answers
191 views

Options Help - Partial allocation of shares?

I'm still learning options trading and got into it recently on Robinhood - but I have a few quick questions. I have 2 contracts for ACB $12.5 Put 9/4. When I go through the steps to exercise it, I ...
Bee's user avatar
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-1 votes
2 answers
223 views

How implied volatility affect options pricing?

TSLA between 23 and 24 October 2019 had their earnings report. TSLA mark price on 23 October was 252$. On 24 October, half an hour after market open reached 297$. as we saw around 44$ push. if ...
David's user avatar
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1 answer
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What happen in this selling call option scenario

I am beginner in trading. So scenario is: For e.g. until the expiry date i want the stock value to stay at $50 or less. But what happen if the stock price went high and then go down near expiry date?...
k31453's user avatar
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3 answers
640 views

Are binary options really part of trading?

I watched many videos and read many tutorials about binary trading. If I really understood it, you bet that a quote/currency/stock market/anything will rise or fall within a period of time. So, ...
Paul's user avatar
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1 answer
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What is Derivative trading and why stock buying selling is not derivative

In finance, a derivative is a contract that derives its value from the performance of an underlying entity. This underlying entity can be an asset, index, or interest rate. By this definition stocks ...
Hadman's user avatar
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3 answers
987 views

Selling covered calls does not make sense

I have one bitcoin and was thinking about selling call while owning the asset. However after some pondering I came to the conclusion that if price drops then the strategy can only be performed one ...
Youss's user avatar
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-2 votes
1 answer
146 views

Exercised an option got the stock less a thousand dollars

The stock price is $19.00 per share. I bought a call, and the strike price $7.50 for a premium of $7.90, at the bottom before I submit it, read "you are paying $790 the right to buy …. At a $7....
Jose Fajardo's user avatar
-2 votes
1 answer
89 views

Ratio Write and Income Taxes

Imagine that an investor owns 500 shares of the XYZ stock with a current value of 50 and a cost basis of 30. He then sells 5 call contracts with a strike of 65 for 2 dollars. Latter he buys back the ...
Bob's user avatar
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Why wouldn't an option's last trade price be between the current bid and ask? [duplicate]

In the option table for SPY there is a column called 'Price' and a column called 'Bid' and a column called 'Ask'. If I wish to buy a call option, I need to pay a premium. Which column is the premium ...
Victor123's user avatar
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-3 votes
1 answer
153 views

How to price this contract in this scenario?

Here is the question: You want to sell a painting you inherited from a grandparent. There is a 10% chance it is painted by a famous artist, in which case it's worth 100k. There is a 30% chance it is ...
CountDOOKU's user avatar
-5 votes
1 answer
302 views

A goldsmith's hedging strategy, simplified

A goldsmith has bought 100oz physical gold for his trade and paid $1300/oz. He is going to be ready to sell his jewels in 3 months from purchase. In order to hedge against falling prices of gold, he ...
Kalypso's user avatar
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-6 votes
1 answer
178 views

How can I reliably "transfer" shares to another person by using market transactions? [closed]

Suppose I wish to transfer 100 shares of a $2,000 stock to person X (a trusted person). I have been holding this stock on behalf of person X for a few years now. Further suppose that it is infeasible ...
Flux's user avatar
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-7 votes
1 answer
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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. ...
Win_odd Dhamnekar's user avatar

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