Kubang
Celebrity Bewarse Username: Kubang
Post Number: 35693 Registered: 09-2011 Posted From: 161.141.1.1
Rating: N/A Votes: 0 | Posted on Monday, June 26, 2017 - 5:55 pm: | |
Kranth1:July 7th call, 15th call endhi?
Calls for July 7th expiry, $17 strike price and he paid 36 cents for each call (which is the right to buy 100 shares at that strike price) - that means he is betting that by July 7th stock price is going to go more than $17. For example, if the stock goes to $20 by July 7th the underlying call option is worth at least $3 (difference between strike price and trading price). Assuming he bought 10 calls, he paid $360 before trading commission. Now they are worth at least $3k if the stock jumps to $20. If the stock trades below $17, then he will lose all $360 of his capital. opposite of this is "puts". first read basics of options on Investopedia or something similar. Ignorance is bliss
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