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Fidelity says this: In the absence of any instructions from you, we will exercise any in-the-money options that remain in your account on their expiration day, so long as they are in-the-money by at least the threshold amount then in effect as established by the Options Clearing Corporation...

Yeah, I mentioned that once in a thread and claimed to have seen it but was shot down that it would never happen.

Thanks MTE. I'm still relatively new to options and have been using them to increase gains on stock holdings. I hadn't thought about buying the put to remove underlying risk. I guess I'm still thinking in the one dimentional arena of stock trading. Options sure are more interesting!

I'm not sure I follow. Do you mean the cost to carry for the one day to be recorded for the dividend?

That makes sense. I guess when you buy options, you should pay attention as well. Exercise when dividend is greater than premium. Thanks, Ray

This morning I was assigned on Aug 22 MSFT calls. I wasn't expecting to be assigned. Anyone know why I might have been? I think there was about $.02 of premium left throughout the day yesterday. Speaking of which, during what hours can options be exercised? Thanks, Ray

You might want to have a look at static, annual and max profit potentials of the particular options. Those numbers in relation to what I think the stock will do in 1-3 months often help make the decision for me. Also, remember that you will be holding a 3 month option during an earnings...

Not on NOK. Sold calls yester bought them back today. And... today is a good day to sell more calls. - Ray

Nope, no edge. Just a belief in mean reversion.

Can you take advantage of OPRA over the internet? A quick glance at the documents seems to indicate that you need a connection to the National Market Systems (NMS) distribution network. Is that a secured network or are the prices available via the internet? If available via the internet, are...

+1 on the thanks!

I cast chicken bones. Much more effective than trying to catch postman. I mostly sell time premium. I use the the knee jerk reactions during the first hour and last 5 minutes as a time machine. - Ray

I find that options give me better metrics to work with than a stock by itself does. I can get a better feeling for risk, reward and time frames. I also find it much easier to be emotionally detached. - Ray

I'm enjoying the conversation as well. Thanks for taking the time Mark. I am definitely a rookie and have learned a lot over the last month just by watching my positions. This discussion is very thought provoking for me and it will not be dismissed without thought. Why ask a question if you...

1) I don't think I'm mistaken. If I am than so is McMillan who also states "if the option begins to trade at parity or a discount, there arises a significant probability of exercise by arbitrageurs" ("Options as a Strategic Investment" page 83). I'd assume he means that if the option starts...

CLF trading around 28.31 Short the Jun 24 call bid 4.60 ask 4.80 Thinking of rolling to the Jul 25 call bid 4.90 ask 5.10 I've seen the net credit higher than this but that's not relevant. The Jun 24 with a bid of 4.60 is .29 from parity which is just over 1% the underlying. As the...

I'm new to options and have some outstanding in the money covered calls coming due this month. I'm considering rolling the up and forward for a credit but have a timing question. Looking at the positions, they are currently 2% of the underlying from parity. At what point do I start risking...

How is open interest used? I understand the definition and that you can't tell if the intrest is short or long which doesn't seem to tell you much. It can also be compared to volume as an indication of short-term vs long(er)-term trading. What else does it tell you? How is it used in...

Ah, that makes sense. Thanks, Ray

I'm not sure I understand this. Can you explain further? Certainly shorting puts in a rising market is profitable, perhaps not as profitable as going long the underlying, but not a losing trade in absolute terms. - Ray