I trade a lot of sub $10 all breaking out and some have Stock Options. My question is why is someone willing to pay $.70 for the June $2.50 Calls if they can buy the physical for $1.59 its now at. Stock is MARK, Volume is high and my entry price has been all over the place as I churn it.
$1.50 share stock with June $2.50 Calls bid $.70x $.85 Why?
- Thread starter JesseJamesFinn1
- Start date
Let's just say you had a friend who had bought 40,000 shares from $1.2-$1.40s, would you tell them to sell the June $2.50 for $.75?
Yes. If he’s willing to hold the stock for that long and believes it will stay between $0.50 and $3.25.
This is the wrong way to look at this.
They are not selling it at 70cts because they WANT to sell. The market maker quotes 70cts because that is the LOWEST price he wants to give you for the risk of being short gamma in this thing.
because thats 50 percent less than the stock cost
most importantly 2.5 i believe is the lowest price with these high fly stocks buying calls contantly and selling deep in the money ones if they become
So is the only way to keep catching profits and not worry about down risk as much as being long the stock
Do you day trade these stocks or swing trade?? I just started more recently taking a deeper look at them but only
The ones with options
I day trade these stocks because of the massive volume and price spikes. Some of the thin issues like RVP or FLDM I might swing trade if they hold their own and no worries about a shelf-offering. What's fun is the followers of WS Bets and Robinhood are attracted to them.
I dont know my friend does same as you but i cant help but see how much more there is opportunities in swing trading them specially with options
well
Only
With options for me
I think Options add the icing to these micro cap pumps. I miss lots of the big gaps the following day because I go flat. I did catch UAVS in April when it went from $.9 to $2.40. Had a good cost basis so I carried it over from its close of $2.40? It open's up at $3.7 lifting off to $5.15 quickly falling down to $1.00. All the poor newbies on StockTwits or Robinhood had no idea what hit them. Its easy to understand why many on Elite avoid them.