Hello all, new to this forum and new to options trading all together. In a nutshell, helping my mom after my father recently passed. One of my co-workers is a regular in another forum and he suggested I throw myself on the mercy of some of you guys in this forum. In one of my father's accounts (joint with my mother) there are several open options. I have zero idea on how to proceed and whether I should wait for them to expire or close if they are ITM. Of course, want to maximize the profit and minimize any losses for my mom. She is a retired school teacher and my father was retired from railroad so most of their stuff is in pension plans. My father seemed to have several trading accounts that mom said he "played" with from time to time. I am just trying to get a handle on what is going on sooner than later since some involve AAPL with earnings on Monday, don't know whether to close or wait it out. I attached what he has active. Any help, suggestions, comments would be greatly appreciated.
My condolences. You have bigger concerns with your family. Liquidate it all after the first hour of trading when the bid/ask has stabilized. Time is of the essence because you are dealing with contracts that can expire or be assigned in excess of the account capital. Additionally, the daily fluctuations of the account is considerable. 11% on a daily basis is big. I hope you understand the difference in: 1) long(bought) and short(sold) positions. 2) market and limit orders 3) Executing a simultaneous ( Combo ) order for spreads, which some of those trades seem to be. But, this is a risk: The broker might raise a stink if you are not supposed to have access to his accounts (such power of attorney). What are they going to do sue you? Probably not. They are just an intermediary and not a stakeholder in those positions.
My *opinion* and not telling you what to do: Close out the FXE stuff (Euro), I doubt it's going there and they still have value left. Keep INTC positions as gambles (they aren't exactly getting any worse) or just close out. MC, probably just close this out. KMI, don't know. AAPL, don't know, not sure. When we say "close" or "liquidate" that means sell-to-close and never exercise. Do not exercise any of the options and make sure that anything ITM is sold-to-close before expiration.
The broker will have a phone number where you can call in trades. Have your mother call them up and the magic words she needs to utter are "please liquidate all my open positions at the market". This should be done about an hour after the market opens in the morning; options are very weird in the first few minutes of the options market. By the way, I agree with xandman that there is a hell of a lot of risk / fluctuation in these positions. Either he was a bit of a gambler or there's a lot of cash in the account to back his trades up. In any case, he made money on these so who can complain. I don't see any problem with liquidating the positions yourself but why risk it? The broker's phone is exactly for these sorts of situations.
I will back pedal a bit and give a +1 to TooOldForThis. Make the call to the broker. You have a bit of a learning hurdle in executing this yourself.
Thanks guys, I appreciate the feedback. He was a bit of a gambler, but always seemed to come out on top of his trades. As far as the money in the account, he has several hundred thousand in this particular account. The only thing that worried me were the Apple positions, he has been hoarding Apple stock since the late 80s/early 90s. It is one of five stocks he bought every month for over two decades. I just wasn't sure how to handle those, he had asked use to execute those options when the time came. In talking to some friends they explained it could be a risk and I just didnt know enough about options to advise my mother either way. These are in an account that he traded himself and did not utilize his normal broker. Can't tell you guys how much I appreciate the input. Best of luck.
More importantly, thanks for all the condolences. It was semi expected, but had hoped for a recovery.
Here is my advice, Your goal should be to liquidate these positions, not trade them. You have no idea whether the stocks are going up or down, just close them out now. Most of value of the portfolio is in the Apple options. These are simply a bet the stock will go up. Sometime after the market opens tomorrow morning (agree with others to wait until after the opening, but 10 minutes should be enough for better markets) simply sell the Apple calls at the market. Next sell the FXE puts at the market, and then the KMI calls. This gets you out of almost all of your dollar risk. You can then sell the other positions at the market with the exception of MC puts. There is a very wide market here, so instead of sell these at the market I would split the bid and offer price, slowly going down until you are filled Good luck
I bet your father planned to hold those options until expiration or he wouldn't buy such far out expiries.
Ultimately if you plan to get rid of those AAPL positions sooner rather than later then you want to do it before close of market Monday. Presently volatility should be quite high due to earnings which will inflate their value. Post earnings if they don't move much the value will drop. If AAPL does good they'll of course go up. IMO those positions are the only ambiguous ones to figure out what to do with. The rest I would just close except for INTC because they've already lost the vast majority of their value.