Hey all I have a question if anyone has any experience using Saxo Invest (from the UK) if I buy calls in HPE at strike price 20 for 6/7 and they go in the money, do I have to exercise the option to make profit or can I sell on the call options without exercising? Trying to learn how this all works to dip my toe in.
Advice for trading options (UK)
byu/Fuckedaroundoutfound inoptions
Posted by Fuckedaroundoutfound
2 Comments
You can sell without exercising.
That kind of short-dated OTM earnings play is very risky though, so be prepared to lose all the premium you paid for the option. You could still lose even if the option does go in the money.
Pretty much in every situation for stocks with good options liquidity you will have more profit by just selling the call rather than exercising the option to sell the shares.
For options buyers who don’t intend to hold the stock, exercising options is just a kind of rare niche thing you can do to mitigate risk around binary events during after hours or to liquidate if there is very low volume on the option, but assuming that it is ITM then there should always be a buyer for at for the difference in intrinsic value of the 100 shares.