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I'll poke around the broker's web site to see where the open interest is on options. Won't make the same mistake twice. So that would be 200 open bids as I buy a contract, right?

I appreciate your reply. This helps a lot. Regarding volume, do you mean I should see if there at least 200 contracts written(existing), or that I should buy 200 contracts going in? That would be steep. I'm sure I can find the existing volume somewhere associated with the broker's web site. I've...

:cool:

:thumbsup:

OK .... MNK bought $2.50 July 2 Put at 0.40 = $40.52 with commission. Traded today.

Got it. Selected a stock that was cheap, has very strong sell recommendation from this site: https://www.tradingview.com/screener/ I see that the Theta listed for this is now -0.97 It has a 7/2 expiration. I'm assuming that since it has zero bids, that it will not sell. Lesson learned. Look at...

OK, thanks. I'll see if I can take a look at volume data next time before placing a trade. But, my understanding about how the option should be priced is correct isn't it. Option price should rise as stock price drops with a bought Put. I understand that it's not directly related but generally...

Trying to keep the cost of my education at a minimum. Bought a July 2 $2.50 Put, one contract for a total (with commision) at $40.52. Stock price was at $2.86. Stock price dropped to $2.81 and the options contract price dropped to $17.50. Isn't the option price supposed to rise as the stock gets...

ok. I appreciate your advice. I'm not investing thousands of dollars. Most of my trades are in the $80 - 300 range and I am not spending more than I can afford to lose. That having been said, I've done ok so far and as long as I'm cautious and conservative, I feel good with it. Thanks again.

Books? what are those? All online readings. Every site that yields results to my questions. Poking around to make sure I know what I'm getting into. One or two naked calls, about 5 call spreads and one put spread so far. Today was a downer, but good for the put spread. I appreacite your replies...

Found my own answer ... https://www.fidelity.com/learning-center/investment-products/options/options-strategy-guide/bull-call-spread#:~:text=Example%20of%20bull%20call%20spread&text=Profit%20is%20limited%20if%20the,long%20call%20(lower%20strike)

Thanks. Yeah, not spending all that much while the learning curve builds. Can you help with this question.... Buying a call spread of 40 Buy / 60 Short with stock at $42 with net cost $300. I understand that the short sell would hopefully stay below the strike price of $60 but should the asset...

This is a clear and consise explanation. Thank you for helping me.

Well, here's my thinking. If I could exercise a call at a strike price of $80 and sell it the same day at $95 why wouldn't I? Roughly $1500 profit in a matter of a day or two. I was asking about the uncovered call I sold at $80 and the buyer (not me) exercises their option to buy at $80 while...

If buying a vertical call where I buy a call at strike price of $80 (ITM) and sell a call (uncovered) at $95 I'm asking that should the buyer of my sold call at $95 exercise the option if the stock were to hit, say, $110, should I assume my best action would be to exercise my bought option at...

Thank you!

New guy here. Doing a vertical call my net cost is $0.90 or $90 for 100 contracts. Some articles have stated my MAX loss is Premium ($0.90) x 100 = $90. MAX Gain is Width - Premium. In my case that's: 3.5 - 0.9 = 2.6 x 100 = $260. This is not Net profit is it? Shouldn't Net Profit be: $260 - $90...