So GM is betting that AMX is going to go above 137.60 before June 18, correct? and if it goes up even just $1 dollar over that target, then he will likely call it a win and sell right?
T, I bought the June 18 125Call for $1300. if AMX goes down tuesday, I will be able to buy another one for say $1200... so average of $1250. All I need to do is watch the price I paid; I don't car what the stock is priced at, I only need to sell for something more than $1250. So if I sell both for $1300 then I make a few bucks.
approximately, fees and such... also, you can set your sell order immediately following your purchased option. enter a sell order for the price you like, say $1350 - let is ride, take a nap, make $100 buck. differing options have differing intra day variability you can skim off of but best to do it in the context of GM trading methods.
So a JUN 18 '21 with 125 strike, 12.60 premium... Is this what you're talkin about? I'm new to options trading :)
yes, buy one and if it goes lower buy another. Then sell when you are up 2 or more percent including your trading fees.
So GM is betting that AMX is going to go above 137.60 before June 18, correct? and if it goes up even just $1 dollar over that target, then he will likely call it a win and sell right?
T, I bought the June 18 125Call for $1300. if AMX goes down tuesday, I will be able to buy another one for say $1200... so average of $1250. All I need to do is watch the price I paid; I don't car what the stock is priced at, I only need to sell for something more than $1250. So if I sell both for $1300 then I make a few bucks.
You would profit $50 in that scenario right?
approximately, fees and such... also, you can set your sell order immediately following your purchased option. enter a sell order for the price you like, say $1350 - let is ride, take a nap, make $100 buck. differing options have differing intra day variability you can skim off of but best to do it in the context of GM trading methods.
Thank you very much! Appreciate the explanation
SBUX and ORCL sucking it up big time