Call option value, exercising or selling the option

[FP22]

You got some great info on how to handle this trade. As far as taking on selling options to collect premium against your leaps... I wouldn't do that until you had a better understanding of options. My recommendation would be to take the profit now and buy a good book on options. Of course you can learn as you go but it will likely cost you more than building a good options knowledge foundation first.

Robert had a great example of when to exercise your calls early to get the underlying for the dividend but that depends on many more details that he alluded to. I do believe your original question was trying to understand when and how to execute options that you can't sell at or above intrinsic value. This is more common in low volume / low open interest options. If the volume just isn't there and that is a learning point in itself. SO, in the future, if you can't get intrinsic on your ITM calls you can execute then sell OR you can short then execute.

Congrats on your profit

 

[smallfil]

Thanks smallfil.

I am not used to sell options, that's completely new for me and I'm a bit afraid of it because I don't know if I have to deliver the shares or what I have to do.

I'm with interactive brokers. Can I lose more money than I put in If I sell options? When do I have to deliver the shares? Do I have to have the underlying shares in my account? Does that happen automatically from my broker? It's really abstract for me to do this when I have never sold options before. You can also PM me.

If your call options gets called meaning exercised, you would need to have the monies to buy those shares in your account. Pretty straight forward because your shares will be sold to the call buyer at the call price. Then, locking in whatever gains you may have after you get paid. The buyer of your shares gets to sell it at a higher (current) price of the stock. Of course, assuming the trend of the stock you have that LEAP remains strong, you can elect to hold onto it and let profits pile up. Make sure you have a mental stop though, on where you would want to exit once, it triggers. That way, you can maximize your gains. You have lots of time in your favor.

 

[tommcginnis]

https://www.ebay.com/itm/Options-Ma...m466491e7d7:g:7qEAAOSwq1JZL1so&frcectupt=true