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Strategies & Market Trends : Options for Newbies -(Help Me Obi-Wan-Kenobe)
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To: MJR who wrote (533)12/21/1997 6:06:00 PM
From: Walkbarr  Read Replies (1) of 2241
 
Hi MJR,

I will try to answer your questions. First of all I have only been trading options for about 10 months, so I'm far from an expert.

If you had purchase an call option and it in the money on the third friday of the month of expiration, then you have two possible actions that you may take:

1) Sell the option anytime prior to expiration, for the value of the option, the closer it gets to expiration the lower the time value of the option.

2) If you would like for the stock to be put to you, do not close the postion out, the stock will credited to your account, you will have to pay the strike price for the stock though. For a stock around 10, the strike prices will be 7.5, 10, 12.5 or 15 depending on the popularity of the stock.

Most options are never exercise.

Hope this helps.

Merry Christmas!

David
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