Bought 1 VLO oct 75 call. Maybe I should have bought the december so I have more time, but I dont need to win on my first trade. This was just to satisfy my craving to trade options. cm
Trying to time the markets via the outright buying of a put or a call historically is very very difficult.
I made 17.00 today on my option...what I dont get is, Im out-of-the money..I thought you could only make money on a simple call when the stock price is >= to the strike? cm
Hi cashmoney69 I thought you could only make money on a simple call when the stock price is >= to the strike? Thats on expiry, what's probably happened to VLO is that the volatility has increased due to a down move in the market. I suggest that you get a good book on Options behavior as in reality any number of variables can come into play when trading Options. Whether I win or lose at the end of a trade, I always start out needing to win! Otherwise I might just as well go to a Casino. Best Regards Johno
Go to www.888options.com and read all the free educational material on options before you put anymore money into something you dont understand. We don't trade just because we want so badly to trade an option, we do it to make money. This is not a game so learn the risks before putting real money in. If you do not understand time decay, deltas and volatility, then you are not ready.
Even you are out of the money now, you can still profit but very very little cuz it's still out of the money so let's say when stock proice move $1, maybe your option premium move only lesser than $0.50. As you get in the money, your delta increase. The stock move $1, maybe your option premium move abt $0.50. And when you get even deeper IN THE MONEY, stock price move $1, your option premium move about maybe $0.70 or so... it depends. To get a more accurate one, I always go to http://www.ivolatility.com/calc/ *** To be more specific, the deeper IN THE MONEY you are, the higher the delta.