Buy to Open, Sell to Close

Discussion in 'Options' started by rgilbert93, Apr 27, 2010.

  1. So you've bought a put on a company.

    When you're selling to close, does this mean you are exercising the option, buying the underlying stock, and then selling it to close your position??

    Just a yes or no will suffice. Answers will be greatly appreciated.
  2. no.

    once you sold the put and you are back before you bought it (+profit, -comm)
  3. risky63


    you BOUGHT a put to open your position as stated.
    your selling to CLOSE the position.
    you are now FLAT or OUT of the position.
    no exercise or finger twidddling needed.
  4. Sorry for all the questions... but

    say I want to create an order where if:

    the bid price on a particular call goes up 13 points ($.13) from .40, I place a limit order of (.55) that is GTC

    Would I use a trailing stop?
  5. 'Place a limit order' to do what? Obviously it's sell.

    "13 points" is $13, not 13 cents

    Why would you use a trailing stop if your exit price is $0.55?

    I do not believe trailing stop orders are allowed for options.