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if you start with $50K in cash you have $50K for options trading, $100K for overnight trading and $200K for equity day trades. If you bought $50K worth of calls, you should have 0 BP across the board since options are not marginable. you sell the calls you bought and your day trading...

your day trading buying power does not increase from what you started the day with. if you sell a position you held overnight those funds can be used for a trade, just not a day trade. day trading buying power is based on your maintenance excess from day before's close. options can't be...

lot's of good info and videos on the CBOE site as was mentioned earlier. Dan Sheridan is one instructor that comes to mind

not if he's selling to open...

the same will happen if you buy a call to turn it into a spread rather than a naked call

wasn't a dumb question. nobody is born knowing these answers. most of the time selling the calls is your best solution but before you just blindly sell the calls, check the price of the calls against the price of the stock. would you make more $ by selling the calls or by exercising and...

a lot of places wouldn't let you put on this trade without an account value of at least $2k (minimum for margin). But if you could put it on and it's close to 105 you should probably either close the position out or inform your broker that you will exercise the 105 because some will not let you...

yeah, good point.

no kidding, guess the buyer didn't have the $ to pay for the stock either

your friend is wrong. you keep what you sold the calls for initially and you sell your stock @ 2.50 that's all that happens with a covered call.

ok, I see what you mean. I thought people would recognize that ridiculousness of the strangle suggestion, but I guess not everyone did. I didn't think anyone would really consider buying the strangle when vol is not expected to rise. :)

looks right. where's the additional ("safety") come in to play? How much do you think this should cost?

well, would that strategy have made any sense? trades at a range of 132-154 so neither side goes ITM. Vol doesn't rise either so this strangle would pretty much be doomed don't you think?

he should have until the market close to liquidate out of his call, and 5 days later to bring in funds to cover the assignment. but firms often word in their margin agreements that they can raise the margin requirements without notice, and can close out positions without notifying the customer...

most of the time it's worded in the account agreement, margin agreement, or even options application that they can do it if the account has the risk of going negative equity. I doubt they would do it to avoid a margin call.

you don't need $33,000. Reg T is 50% and you can apply the release of the margin requirement you had on this position. sounds like you will get a fed call, but you can meet that without penalty the day after assignment by closing the assigned position out. You'd have to do this Monday though.

what's not? some firms will close out a position that looks like it will be in the money if the client does not have enough buying power to take assignment.

was being sarcastic my friend...of course the strangle I threw out there made no sense

do you have 100 GOOG in your account? any long calls or short puts that may have finished in the $ too? If you haven't checked your account yet, it's possible your broker/firm may have closed this out for you if the assignment carried too much risk for your account.

long strangle. buy the 132 puts and buy the 154 calls