I have a bear call spread that went into the money by 1.82 & it expires in July. It was a very stupid trade in AIG- Yes I know it was very stupid to play with this stock & I screwed up big time (feel free to abuse me if you REALLY feel the need to- I can take it)
I sold the 10 call and bought the 12.5 call for a credit of 520.00.
A complete loss of (2500-520=1980) will not kill me as it is less than 3% of my account.
The way I see it I could sell a put spread (-10 +7.5) and use the credit to offset my loss on the call spread.
I could sell a naked call at 10 and offset the loss even further than a put spread.
I could just buy back the short call and "hope" the stock keeps rising enough to profit on the long side of the spread.
I could do nothing and hope for the best.