To everyone on the thread:
I was was curious about options expiration and its potential effect on prices during options expiration. I myself have sold a number of covered calls for the August 105 and the August 100. What I am wondering about is why my selling of covered calls should have an effect on the stock price. Personally, I am just doing it to obtain some quick additional income trying to sell covered calls towards the higher end, out of the money (as in the case of 105, and, unfortunately, 100). What I failed to understand is why this sale should effect stock prices. By selling the covered call and receiving immediate additional money. If the price of the stock reaches the strike price or slightly above it, the odds are that the option will be exercised and I will end up losing the stock at the strike price. Now in the case where the value of the stock/call is approaching the strike price (forgetting about the time factor component) and I feel that I want to withdraw my participation in this option, all I have to do is to buy back my option, which I understand can also drive up the price of the option but not the stock. Maybe this has more to do with puts. Right now I'm a bit confused.
To summarize my question, does the selling of covered calls and even the buying of covered calls have an effect on price of the stock during options expiration? And if so, how does it work.
Inquiring minds want to know.
My thanks in advance.
David.
Postscript: yes, I ready have McMillan's book on my desk (where it has accumulated a nice coating of dust, I might add). I just looking for a quick answer. My thanks again to whoever responds.
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