And I cannot get approved to buy a call through scottrade.... If you are interested, check out .JLWGB You buy the call for $163 with a strike at $10 per share, then exercise the option immediately to pick up 85 shares at $10 each plus $13.75 cash. Its a non standard option, thats why its only 85 shares. Then sell the 85 shares for $13.42 So you pay $163+850=$1013 plus comissions Thats $11.92 per share Then sell the shares for $13.42, more or less = $1140.70 $127 profit minus commissions or 12.5% I tried to buy the option 3 days ago when it was only $125, I woulda made a killing....
you should note that 1163/85 = 13.68 which looks suspiciously like the share price plus a bit of premium
The multiplier doesn't change. You pay $163 for the contract plus 10*100 = $1000 for the exercise or $1163.
Playing that would be a classic rookie move. I do not know exactly the details of the "payment" on the JLW series but what is 100% certain: these are the former MER options. AKA it means it represents more than 100 ordinary shares of BAC, maybe something like 120... (again I don't know exactly I don't trade this stuff)
The stock market is like your local diner: There are no free lunches But they are always willing to roast a newbie
No I asked my broker, you only pay for 85 shares, not 100 shares. Or maybe I'm a dumb ass by false information.
Thats true... Anyone have a link to explain the way non standard options work? If I was given false information by my broker I'm gonna be pissed.