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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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Why is this option trade considered over the counter
In this article
the author says:
Since June 24, crude prices halved while CVX has dropped only 20%.
SPY has risen slightly less than 3% during that time period.
What’s a good options stra …
0
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1
answer
88
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Why the call option premium sometimes does not decrease the further out of money we go
Usually when you have an option change, the further OTM you go, the premium drops for the same expiry date.
But if we look at the Mar 2015 Call and Put option chains for VIXY, it seems this is not alw …
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1
answer
68
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Can a deeper ITM call be cheaper than a less deep ITM call for same expiry date
In this option chain for SPY Apr 25 calls
the one with a strike of 170.50 has a lower price than the one with a strike of 171. But why is this? 170.50 call is deeper ITM than 171, so it should be mor …
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1
answer
990
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What is the probabiltiy of being assigned if the call expires in the money
If I sell a call option and at expiry, the call is in the money, is it guaranteed that I will be assigned and will need to deliver the underlying? What is the probability of assignment/
My question i …
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1
answer
7k
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Why out of money options show no bid price but a valid ask price
Looking at the option chain for SPY
I see that a lot of the out of the money calls are showing Bid as N/A. What is the reason? Nobody wants to buy out of the money calls because expiration is approac …
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4
answers
6k
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If the put is more expensive than the call, what does it mean
If an At the money Put trades for much higher than the ATM call, can we say that people are expecting the stock to move down? After all, what else could be the reason if the put is more expensive tha …
3
votes
1
answer
1k
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Sell covered call on an index option
When I trade an index option (SPX), there is no actual trading going on in the underlying (as opposed to SPY).
But some option strategies (like covered call) by definition require a position in the u …
2
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1
answer
99
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Can I get an assignment notice as soon as I sell a covered call
If I sell an American style ITM covered call, then in theory, can I get an assignment notice as soon as I have sold the call, since the counterparty can opt for early exercise? Does this ever happen o …
2
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1
answer
641
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How does a dividend announcement affect a option straddle position
If I buy an at the money straddle, hoping to profit from a volatility increase, then how does an underlying dividend announcement affect my PnL?
I am thinking that if the underlying announces a divid …
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9
answers
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Why does a call option's price increase with higher volatility?
As per the Black-Scholes model, the value of a call option is directly proportional to the volatility. Without getting into the derivation of the BS equation, is it possible to intuitively understand …